Additional  Burdens  upon  Street 
Railway  Companies. 


ARGUrvIENT 


OF 


Thotv^ms    p.    Prooxor, 


In  Opposition  to  allowing  Cities  and  Towns  to  impose  Taxes  for 
the  Use  of  Streets  by  Private  Corporations, 


MADE  BEFORE  THE 

Committee  on  Cities  and  the  Committee  on  Taxation, 

Of  the  Massachusetts  Legislatui;^,  sitting  jc;i,ntjy, 


BOSTON: 
PRESS    OF    SAMUEL    USHER, 

171  Devonshire  Street. 
1891. 


5?5 


COMMITTEE  OH  CITIES. 


^ 

JP 
y 


WILLIAM  S.  McNARY,  of  Suffolk, 
jO  AKTHUR  B.  BREED,  of  Essex, 

^  WILLIAM  H.  WEST,  of  Suffolk, 

^  Of  the  Sbnatb. 

o 


FRANCIS  W.  KITTREDGE,  of  Boston,. 
WILLIAM  E.  MEADE,  of  Salem, 
EDWARD  W.  PRESHO,  of  Boston, 
JOSIAH  QUINCY,  of  Quincy, 
WILLIAM  P.  BUCKLEY,  of  Holyoke, 
WILLIAM  POWER  WILSON,  of  Boston, 
GEORGE  S.  CLOUGH,  of  Worcester, 
ISAAC  ROSNOSKY,  of  Boston, 
Of  the  House. 


COMMITTEE  ON  TAXATION. 


MORGAN  ROTCH,  of  Bristol, 
WILLIAM  S.  McNARY,  of  Suffolk, 

Of  the  Senate. 

FRANK  P.  BENNETT,  of  Everett, 

NATHAN  EDSON,  of  Barnstable, 

)^  HENRY  C.  WHEATON,  of  Worcester, 

>  AARON  O.  WILDER,  of  Leominster, 

o 
"Z^  MYRON  L.  CORBETT,  of  Bernardston . 

»3  JAMES  H.  CARTER,  of  Wakefield, 

'  CHARLES  A.  KELLEY,  of  Boston, 

cP 
2^  Of  the  House. 


^av^ii 


AROUMENT    OK 
ThOTVTMS     R.     RrOCTOR,    Esq. 


Mr.  Chairman  and  Gentlemen:  — 

There  have  been  a  great  many  bills  presented  here,  some 
ten  or  fifteen  petitions  and  four  or  five  different  bills  ;  and  as 
I  am  expected  to  substantially  close  for  the  remonstrants  it 
will  become  necessary  for  me  to  refer  to  all  the  bills,  for 
I  have  no  knowledge  which  one  approbates  itself  to  you. 
Hence,  I  must  speak  upoli  the  question  broadly. 

The  old  Commonwealth  shows  no  partiality.  It  treats  all 
its  children  alike,  whether  natural  or  created.  John  A. 
Andrew  said  to  me  the  night  before  I  went  to  the  conven- 
tion for  his  first  nomination  as  governor,  "  You  know  I  have 
very  extreme  views  on  various  subjects,  but  if  I  am  nomi- 
nated for  governor,  and  elected,  I  shall  be  governor  of  the 
whole  Commonwealth  and  treat  the  conservatives  as  well 
as  the  radicals  and  hold  my  extreme  views  in  check."  But 
if  there  are  any  on  this  Committee  or  among  the  petition- 
ers who  have  extreme  views  on  this  subject  and  so  very 
extreme  that  they  ask  the  Legislature  to  take  money  from 
the  horse  railroads  and  put  it  into  the  treasury  of  the  city, 
however  illegally,  however  much  against  a  breach  of  faith, 
however  much  against  public  policy,  however  much  against 
the  harmony  of  the  communities  in  which  the  companies 
exist,  and  to  their  detriment,  then  I  say  to  such  extreme 
men,  "  You  stand  in  your  own  darkness ;  and  my  prayer  is, 
that  I  may  give  you  a  little  light." 

Matthew  Arnold  told  the  defects  of  the  Americans,  but 
he  said  the  defects  of  the  Americans  were  not  the  greatest 
trouble  —  they  did  not  know  what  their  .defects  were,  and 
from  the  fact  that  they  did  not  know  them  they  could  not 


6 

correct  them.  But  I  hope  that  anybody  who  has  any  defects 
or  extreme  ideas  on  this  subject  will  seek  light  and  seek  to 
correct  them. 

The  only  source  of  all  this  trouble  is  the  yawning  maw  of 
the  city  of  Boston.  The  Legislature,  in  its  wisdom,  has  seen 
fit  to  limit  the  power  of  the  city  to  tax  its  citizens.  It 
could  not  trust  the  city  government  to  tax  the  citizens 
unlimitedly  ;  and  consequently  certain  persons  look  about  to 
see  ho\v  they  can  get  some  money,  to  see  how  they  can  cease 
to  tax  the  taxpayer  and  through  the  horse  railroads  tax  the 
passengers.  They  must  bleed  somebody  and  they  choose  to 
bleed  the  horse  railroads  to  supply  the  vacancy  in  the 
yawning  maw,  and  bleeding  the  horse  railroads  they  bleed 
the  passengers  who  ride  upon  their  cars.  It  has  been  asked 
by  one  of  your  Committee  not  now  present,  "  Will  it  make 
any  change  with  the  passengers  if  an  additional  charge  is 
put  upon  the  horse  railroads  ?  "  I  am  amazed  that  such  a 
question  should  be  asked.  Everybody  knows  that  one  half 
of  the  corporations  are  bankrupt  to-day  or  paying  no  divi- 
dends, and  if  they  are  earning  just  enough  to  pay  their 
expenses  without- enough  to  pay  any  dividends  and  they  are 
paying,  call  it  for  form's  sake,  a  hundred  dollars,  and  you 
put  on  a  charge  of  ten  dollars  more,  where  is  the  ten  dollars 
coming  from  except  out  of  the  wages  of  the  laborer  or 
increased  fares  or  lessened  service  or  non-extensions  or  a 
saving  from  some  source  to  pay  that  extra  ten  dollars? 
Does  anybody  on  this  Committee  hesitate  for  one  moment 
upon  the  question,  that  if  you  put  on  an  additional  charge 
it  has  got  to  come  out  of  one  of  those  five  sources  ?  You 
cannot  turn  a  pint  into  a  quart  —  not  by  the  present  laws  of 
science. 

Now,  gentlemen,  here  is  an  attempt  to  bleed  the  corpora- 
tions for  various  motives,  and  the  first  one  is,  the  capitalist 
with  his  millions  (who  does  not  want  to  reside  in  Nahant) 
wants  to  keep  his  taxes  low,  and  so  he  says,  take  what  more 
is  necessary  out  of  some  corporation  where  he  does  not 
happen  to  hold  any  stock.  There  may  be  another  motive 
for  this  movement.     It  may  be  that  a  gentleman   seeking 


political  preferment  wishes  to  hold  his  sail  and  catch  the 
breeze  that  will  move  him  into  power,  and  hence  he  is  will- 
ing to  come  here  and  ask  you  to  put  this  thing  through  and 
associate  himself  with  the  movement,  with  the  idea  of  catch- 
ing votes  from  the  public ;  but  I  tell  you  that  any  man  who 
does  that  will  find  that  he  has  waked  up  the  operatives  of 
the  horse  railroad  companies  (who  can  hardly  pay  them 
their  wages  now)  and  he  will  wake  up  the  passengers  that 
ride  on  the  horse-cars  if  you  do  anything  that  is  going  to 
result  in  affecting  them,  and  he  will  wake  up  a  storm  which 
will  turn  the  wind  from  this  quarter  into  the  other,  and  you 
will  find  these  men  who  are  seeking  political  preferment 
running  from  this  movement  like  rats  from  a  sinking  ship. 
There  may  be  other  motives ;  there  may  be  a  man  who 
thinks  he  has  perfected  a  great  invention  and  it  seems  to 
him  like  a  delightful  baby  which  he  must  nurse ;  he  wants 
to  push  it  in  here  (notwithstanding  the  policy  of  the  old 
Commonwealth,  that  the  system  we  have  to-day  is  the  best 
one,  and  the  very  one  the  city  of  London  has),  he  wants 
to  push  it  in  here  and  revolutionize  our  whole  system  for 
the  sake  of  having  his  invention  tried,  for  the  sake  of  having 
his  nostrum  put  into  practice,  and  it  will  turn  out  like 
Brown-S^quard's  elixir,  which  lasted  a  few  months  and 
then  disappeared,  and  the  lymph  of  Dr.  Koch.  These  theo- 
ries that  come  up  here  are  nine  tenths  of  them  like  nos- 
trums of  that  kind.  Give  them  leave  to  go  away  and  not 
trouble  this  body  nor  harass  the  communities  where  horse 
railroads  exist. 

Now,  gentlemen,  the  stock  in  trade  of  this  whole  move- 
ment is  based  on  three  untruths.  I  cannot  be  complained  of 
for  calling  them  untruths,  and  I  will  not  say  the  harder  word 
because  the  advocates  thereof  may  be  honest  in  what  they 
say,  although  I  cannot  understand  it  myself.  We  are  told, 
in  the  first  place,  in  this  celebrated  document.  City  Docu- 
ment 144,  —  and  I  wish  more  of  its  authors  were  here,  —  we 
are  told  that  the  corporations  pay  nothing  for  their  right  to 
lay  the  tracks  in  the  streets.  Now,  gentlemen,  I  submit 
that  nothing  is  farther  from  the  truth  than  that.     We  have 


8 

from  the  Legislature  corporate  existence  and"  we  have  author- 
ity to  go  to  the  board  of  aldermen  for  a  location  and  then 
and  there  they  grant  it  on  a  condition.  What  is  it  ?  That 
we  shall  plant  our  capital  in  the  street,  to  remain  forever, 
and  in  sixteen  years,  even  if  it  succeeds,  that  capital  is 
turned  to  dust,  and  there  is  not  a  corporation,  a  railroad 
corporation  in  the  Commonwealth  of  Massachusetts  that  has 
not  sunk  its  first  capital  that  it  put  in  for  the  rights  which 
were  given  to  them  at  the  time,  once,  and  sometimes  twice 
and  thrice.  Tell  me  that  burying  the  capital  in  the  street  as 
the  consideration  for  a  right  is  not  paying  anything  I  It  is 
just  as  much  as  if  it  had  been  paid  into  the  treasury  of  the 
Commonwealth ;  it  is  put  into  the  street  for  the  public  good. 
The  public  has  had  the  benefit  of  it,  of  every  dollar  in  case 
of  those  corporations  which  have  paid  no  dividends  (which 
is  nearly  half  of  them),  and  the  companies  have  changed 
their  fare  and  reduced  it  to  five  cents. 

There  is  no  question  about  this ;  it  is  as  plain  as  two  and  two 
is  four.  The  money  is  paid  out  and  gone  forever  from  every 
corporation  that  is  running  to-day,  and  it  is  put  where  the 
Commonwealth  told  us  to  put  it;  it  is  gone,  and  it  is  a 
consideration,  and  a  tremendous  big  one  too.  Then  they 
mortgage  their  franchise  and  their  road  to  get  enough  to 
equip  it  and  to  run  their  cars. 

Now  here  is  paid  out  say  $100,000  for  the  right  to  lay 
iron  in  the  street,  and,  gentlemen,  it  may  surprise  you,  but 
it  is  the  truth,  that  the  iron  and  sleepers  in  a  street  a  month 
after  they  are  laid  will  hardly  pay  the  expense  of  taking 
them  up.  After  they  have  been  there  a  little  while,  certainly 
it  will  not,  without  the  right  —  mark  you  the  distinction  — 
without  the  right  to  keep  them  there  and  run  the  road,  that 
iron  and  those  sleepers  are  not  worth  the  money  it  costs  to 
take  them  up.  You  put  down  $100,000  in  iron  and  sleepers 
to-day,  and  it  is  gone  forever,  and  these  gentlemen  come 
in  here  and  say  we  have  no  franchise  right  they  are  bound 
to  respect,  and  if  we  have  no  right,  we  have  nothing  at  all. 
The  iron  and  rails  without  the  i-ight  are  valueless,  although 
they  cost  $100,000.    If  we  have  no  right,  then  we  have  sunk 


9 

$100,000  for  nothing.  At  all  events  there  is  the  considera- 
tion for  the  right  that  was  given  to  us  —  we  say  legally 
given  to  us  for  a  valid  consideration  ;   they  say  not. 

Now,  gentlemen,  the  second  question ;  and  I  want  you  to 
bear  this  in  mind  carefully,  because  if  I  meet  any  child  in 
the  street,  and  I  ask  him :  "  Here  is  a  horse  railroad  going 
through  tlie  streets  which  has  never  paid  anything  for  the 
right  of  going  through  the  streets ;  horse  railroad^  in  other 
countries  are  paying  for  it ;  they  are  all  of  them  able  to  pay 
for  it,  —  why  should  n't  this  company  do  it  ?  "  the  child  will 
say,  "  Yes ;  if  these  three  things  that  are  stated  are  true."  If 
they  were  true,  I  would  agree  with  him,  but  they  are  all 
false.  I  have  just  showed  you  how  we  pay  our  capital  for 
the  right  to  lay  the  tracks  in  the  streets,  and  it  is  all  gone 
and  the  public  have  the  benefit  of  it  —  do  not  forget  that, 
because  it  is  the  only  argument  and  all  they  have  to  rely  on 
in  an  equitable  point  of  view.  Now  I  say  secondly,  they 
say  we  do  not  pay  as  much  as  they  do  in  other  countries.  I 
say  that  is  equally  untrue,  and  I  propose  to  show  it  from  the 
document  itself.  I  hardly  need  to  do  it,  for  Mr.  Whitney 
has  demolished  it  as  to  foreign  countries. 

Representative  Kittredge.  Before  you  leave  your  first 
point,  I  want  to  ask  you  a  question.  I  understood  you  to 
say  that  you  pay  $100,000  for  the  right  to  lay  your  tracks 
upon  the  streets.  What  is  the  explanation  of  that  state- 
ment? 

Mr.  Proctor.  I  pay  it  as  a  consideration  for  the  right 
to  lay  them.  I  agree  to  plant  so  much  money  in  the  street 
if  the  Legislature  grants  me  a  charter  and  the  board  of 
aldermen  will  give  me  a  right,  and  I  would  not  give  one  cent 
for  the  right  if  it  is  not  a  permanent  right.  That  capital 
buried  in  the  streets,  whether  it  be  one  sum  or  another; 
whatever  they  bury  in  the  streets  the  public  get  the  benefit 
of,  and  when  we  accept  a  location  we  agree  to  do  that,  and 
that  is  the  consideration  we  pay  for  the  grant  that  is  given  us. 

The  Chairman.  That  I  understand  ;  but  you  do  not  pay 
it  for  the  right. 

Mr.    Proctor.     I  pay   it   for   the   grant  of  a  location.     I 


10 

call  that  payment  for  the  right.  I  get  a  right ;  I  give  the 
money.     It  is  a  contract. 

I  was  just  saying,  Mr.  Quincy,  before  you  came  in,  that 
the  Document  144  does  not  state  what  is  true,  namely,  that 
we  pay  nothing  for  our  right.  •  I  say  every  horse  railroad 
that  pays  for  putting  down  its  track  and  its  sleepers  in  the 
street  in  pursuance  of  the  agreement,  which  it  makes  when 
it  accepts  its  location,  buries  so  much  money  which  is  gone 
forever,  and  is  the  consideration  for  the  right  to  put  them 
there.  That  is  the  contract.  They  say,  you  are  located 
there  if  you  ^vill  put  in  money  enough  to  make  a  track,  and 
the  public  gets  the  benefit  of  it  by  your  running  your  cars. 
That  is  the  consideration.  That  money  is  gone  forever ;  it 
never  returns  to  anybody ;  however  successful  the  corpora- 
tion may  be  it  is  turned  to  dust  in  sixteen  years,  and  in  the 
case  of  more  than  half  the  corporations  it  is  not  only  buried 
once  but  sometimes  twice  and  thrice  to  keep  the  cars 
running. 

Secondly,  I  say  that  this  document  does  not  represent  the 
truth  when  it  says  that  we  do  not  pay  as  much  as  com- 
panies in  other  places. 

Representative  Quincy.  What  is  this  document  that  you 
speak  of? 

Mr.  Proctor.  City  Document  144.  The  city  of  Buffalo 
is  an  illustration  of  what  I  was  saying,  but  as  to  the  impol- 
icy of  selling  off  anything  of  that  kind  at  auction,  first,  they 
bid  them  off  at  thirty-six  per  cent,  and  they  have,  accord- 
ing to  this  report  here,  got  but  one  payment,  of  $340,  and 
the  next  time  it  was  sold  it  was  bid  off  at  eleven  and  three- 
quarters  per  cent,  of  the  gross  receipts  and  not  a  cent  has 
been  received  for  it.  But  it  is  universally  the  case  that 
where  this  business  is  done  in  the  streets  there  is  an  antago- 
nism, —  get  all  you  can  out  of  the  people,  on  the  one  hand, 
and  the  people,  all  they  can  out  of  the  horse  railroad,  on  the 
other,  and  there  is  never  a  healthy,  harmonious  cooperation. 
It  is  best  to  have  something  like  a  happy  cooperation  or 
partnership. 

Again,  Chicago  charges  -foO  a  car.     Take  200  cars  on  a 


11 

road  which  runs  through  a  sparsely  settled  district  here,  and 
that  where  they  only  make  $10,000,  and  we  pay  (in  a  tax, 
that  the  city  of  Chicago  does  not  charge  at  all)  $10,000  for 
our  road,  which  is  no  comparison  to  the  roads  in  the  city  of 
Chicago.     They  do  not  begin  to  pay  as  much  as  we  do. 

Then  again,  Cincinnati  charges  $4  a  linear  foot  of  the  car, 
and  they  do  not  begin  to  pay  as  much  as  we  do  for  the 
same  rights  which  we  get. 

Representative  Quincy.  What  do  you  mean  by  that? 
Don't  they  pay  the  local  tax  ? 

Mr.  Proctor.     No,  sir. 

The  Chairman.  Do  you  mean  not  as  much  as  you  do,  or 
don't  they  pay  a  franchise  tax  ? 

Mr.  Proctor.  There  is  n't  a  franchise  tax  like  that  in 
Massachusetts  in  the  world.  The  only  thing  that  comes 
anywhere  near  it  is  in  New  York,  and  it  is  one  and  a  half 
mills  on  the  par  value  ;  on  $500,000  it  would  be  $750  for 
the  year,  which  is  not  a  tenth  part  as  much  as  we  pay.  I 
asked  George  Fred  Williams  if  there  was  any  other  tax  like 
it,  and  he  said  no,  and  here  is  Brother  Harding,  with  a  zeal 
that  does  credit  to  his  energy  at  least,  could  only  find  this 
New  York  tax ;  so  I  think  you  can  rely  upon  that  statement 
of  facts  as  correct. 

Cleveland,  Ohio,  charges  $10  a  car,  which  is  not  a 
quarter  of  what  we  pay  on  our  little  road.  Detroit  charges 
nothing  of  any  kind.  Jersey  City  charges  nothing  —  no 
revenue  received;  Kansas  City  the  same;  Milwaukee  $15 
a  car ;  200  cars  would  be  $3,000 ;  that  is  n't  half  as  much  as 
our  franchise  tax.  Newark,  N.  J.,  on  the  same  rate,  would 
pay  $12,500,  and  that  would  not  be  nearly  as  much  as  we 
pay,  taking  in  the  things  which  are  left  out  in  New  Jersey. 

I  asked  Mr.  Meyer  when  he  was  here  commenting  upon 
this  document,  and  he  said  he  had  made  no  comparison 
between  our  roads  here  and  these  roads,  taking  all  the 
elements  into  consideration ;  he  had  made  no  comparison 
on  that  basis.  His  statement  is  utterly  worthless.  Nobody's 
statement  is  of  any  value  unless  you  take  into  consideration 
all  these  elements,  and  the  strongest  element  is  the  short- 
ness of  the  line  and  the  compactness  of  the  city  on  that  line. 


12 

Then  I  come  to  the  State  of  New  York,  and  there  is  no 
comparison  between  that  and  Boston,  considering  the  com- 
pactness of  the  city  and  the  shortness  of  the  line.  They 
give  them  a  line  from  the  North  River  to  the  East  River 
right  through  the  thickly  settled  part  of  New  York,  and  it 
is  not  a  third  of  the  distance  we  carry  people  paying  five 
cents.  The  cost  of  running  a  horse  railroad  runs  up  to 
three  quarters  of  all  that  is  received.  You  take  off  some  of 
those  expenses  and  you  magnify  the  profit  immensely  and 
of  course  you  can  pay  a  large  income  out  of  that,  but  with 
us  the  most  of  our  roads  are  bankrupt  and  only  four  pay 
above  8  per  cent. 

The  Chairman.  You  say  you  take  away  the  permanence 
of  that  right  from  the  railroads  and  they  could  not  pay  their 
debts.  As  I  have  understood  it  here,  the  claim  on  the  part 
of  the  horse  railroad  men  and  representatives,  and  as  I  read 
the  charters,  they  have  n't  any  permanence  of  right. 

Mr.  Proctor.     Who  have  n't  any  permanence  of  right  ? 

The  Chairman.  The  horse  railroads,  as  I  understand  it. 
I  understand  that  has  been  the  burden  of  the  complaint, 
that  they  have  not  any  permanence  of  right,  and  you 
want  it. 

Mr.  Proctor.  The  petitioners  have  put  it  that  way,  and  I 
am  taking  them  on  their  position.  If  their  position  be  true, 
to  wit,  that  we  have  not  any  permanent  right,  then  the  iron 
may  be  forced  up  at  any  minute ;  and  if  they  order  them  to 
be  taken  up,  the  iron  and  sleepers  would  not  pay  for  the 
cost  of  taking  them  up  and  fixing  the  streets ;  and  if  you 
take  that  out,  the  rest  of  the  property  will  not  pay  the  debts 
of  any  corporation.  West  End  or  any  other. 

The  Chairman.  Do  I  understand  that  you  are  going  to 
put  your  rights  on  the  ground  that  you  have  a  permanent 
right  ? 

Mr.  Proctor.  Of  course  I  am ;  but  before  I  get  to  the 
law  I  want  to  nail  these  three  untruths,  and  show  that  we 
pay  largely  for  the  rights  that  are  given  us,  and  show  that 
we  are  now  paying  all  that  the  roads  in  other  places  pay. 


13 

when  taking  all  the  elements  into  consideration,  short  lines 
and  thickly  settled  cities  as  against  long  lines  and  sparsely 
settled  towns  and  all  the  questions  of  taxation  that  come  in. 
K  you  could  sit  long  enough  to  get  all  the  facts,  you  would 
find  that  we  are  paying  as  much  as  anybody  else ;  that  the 
policy  of  forty  years  in  old  Massachusetts,  when  you  will 
sift  the  matter  to  the  bottom,  is  the  best  policy,  and  it  is 
revolutionary,  injurious,  destructive  revolution  to  change  it ; 
and  thirdly,  when  they  say  that  we  are  able  to  pay  more,  when 
they  flippantly  say  here  with  a  kind  of  cheerful  assurance 
that  they  know  all  about  it,  that  we  can  pay,  they  simply 
know  no  more  about  it  than  they  do  about  watchmaking. 
They  have  not  taken  the  trouble  to  look  at  the  returns  to 
the  railroad  commissioners,  which  show  that  more  than  half 
of  them  are  totally  unable,  and  I  tell  you  from  my  knowl- 
edge of  them  —  and  I  have  had  a  hard  knowledge  for 
twenty-five  years,  and  I  ought  to  know  something  about  it 
—  I  know  they  are  not  able  to  bear  any  more  burdens  than 
they  are  bearing  to-day.  They  are  giving  the  public,  the 
people,  enough,  and  I  shall  refer  to  it  more  particularly  as  to 
our  road  later. 

Now,  gentlemen,  I  come  to  another  subject,  and  it  is  a 
little  delicate.  What  do  we  find  here  ?  Gentlemen,  excel- 
lent gentlemen,  come  up  here  and  ask  —  what  ?  These  gentle- 
men come  up  here  and  ask  the  Legislature  to  put  power  into 
the  city  to  take  the  money  out  of  one  corporation  and  put  it 
into  another.  They  ask  that  the  city  should  be  the  judge  in 
its  own  case.  A  city  may  have  given  to  it  power  to  regulate 
the  use  of  a  street.  That  is  what  has  existed  here  before 
without  limit  or  control,  but  never  before  in  my  experience 
or  within  my  knowledge  has  anybody  had  the  audacity  to 
approach  a  Legislature  in  any  State  and  ask  to  have  a  man 
or  a  city  or  a  corporation  given  the  power  to  determine  how 
much  money  he  shall  take  out  of  somebody  else's  pocket 
and  put  it  into  his  own.  Monstrous  in  the  very  simple 
statement  of  it,  but  how  much  more  monstrous  does  it 
become  when  the  very  man  who  comes  up  here  and  asks  to 
be  one  of  the  factors,  with  his  associates,  to  take  the  money, 


14 

comes  up  here  and  says  to  you :  "  I  want  the  power  to  take 
that  money,  and  I  am  going  to  take  all  I  can  get,  and  I  am 
going  to  deal  with  them  just  as  I  would  with  a  tenant,  and 
screw  them  up  to  the  highest  pitch." 

I  say  that  to  make  the  city  a  judge  is  the  most  monstrous 
proposition  I  ever  heard  of,  and  how  much  more  monstrous 
does  it  become  when  a  man,  manifesting  the  spirit  which  the 
leader  of  that  body  of  the  city  government  did  manifest, 
comes  and  asks  to  have  himself  with  his  associates  made 
the  judge.  Good  heavens !  on  what  times  have  we  fallen  ? 
Have  we  lost  the  first  principles  of  honesty,  the  first  prin- 
ciples of  propriety,  the  first  principles  of  having  any  judge, 
whoever  he  may  be  — 

Representative  Rosnosky.  Mr.  Chairman,  do  I  understand 
the  gentleman  to  be  alluding  to  the  city  document. 

Mr.  Proctor.  Not  at  all :  I  am  not  alluding  to  that.  I 
am  alluding  to  the  impropriety  of  making  the  city  its  own 
judge  of  how  much  it  should  take  out  of  anybody's  pocket 
and  put  into  its  own  treasury,  and  then  I  state  beyond  that 
that  it  is  improper  to  give  the  power  to  any  board  of  aldermen 
who  have  manifested  a  prejudgment  already.  Still  greater 
is  the  reason  for  caution  and  delay  in  crossing  the  lines 
which  have  been  established  from  the  time  King  John  gave 
the  Magna  Charta  to  the  people  of  the  world.  I  have  said 
nothing,  remember,  Mr.  Chairman  and  gentlemen,  in  any 
way  reflecting  on  any  gentleman  connected  with  any  docu- 
ment. I  commend  their  zeal  as  far  as  it  went.  The  mis- 
fortune of  it  is  that  it  went  only  so  short  a  distance  and 
produced  a  result  which  did  not  give  the  truth  and  the  whole 
truth,  so  that  it  would  not  mislead.  My  criticism  of  it  was 
simply  that  it  has  caused  many  people  to  believe  that  the 
three  propositions  were  true,  to  wit,  that  we  paid  nothing 
whatever  for  our  rights,  that  other  people  paid  more,  and 
that  we  were  able  to  pay  more,  neither  of  which  propositions 
is  correct. 

Now,  gentlemen,  I  have  called  your  attention  to  the  ques- 
tion of  making  a  man  his  own  judge,  and,  as  the  next  subject 
alluded  to,  I  come  to  the  question  that  most  of  the  bills 


15 

that  have  been  put  in  here  have  been  put  in  without  any 
appeal  from  that  judgment,  which  only  aggravates  the  mon- 
strous proposition.  And  then,  gentlemen,  still  another  point 
—  not  only  is  there  no  appeal,  but  there  is  no  limit  to  the 
spirit  which  may  induce  any  body  of  the  city  to  take  as 
much  money  as  they  have  a  mind  to,  when  it  is  necessary 
to  build  any  new  streets  or  carry  through  any  new  enterprise 
they  want  to,  to  say  nothing  of  a  junket. 

Representative  .     Mr.  Chairman,  Mr.  Proctor  thinks, 

then,  that  a  bill  which  gave  a  right  of  appeal  to  some 
board,  as,  for  instance,  the  railroad  commissioners,  which 
limited  the  amount  to  be  charged  by  the  city,  with  a 
guaranty  to  the  stockholders  of  the  corporation  that  they 
would  receive  their  just  due,  —  you  think  that  would  not 
be  objectionable. 

Mr.  Proctor.  I  would  not  answer  your  question  quite 
yes,  but  I  would  say  that  that  proposition  would  be  very 
many  times  better  than  those  that  have  been  presented,  and 
I  thank  you  for  asking  the  question ;  and,  gentlemen,  there 
is  still  another  most  terrible  proposition  in  here  in  this  con- 
nection, that  can  only  be  known  to  a  horse-railroad  man, 
and  it  was  drawn  out  by  my  questions  to  Mr.  Harding.  He 
says  when  this  is  passed,  Mr.  Whitney,  for  illustration,  will 
be  called  up  and  asked,  How  much  are  you  going  to  give  for 
Washington  Street  ?  and  the  thing  would  all  be  done,  —  that 
is  the  practical  way  it  would  be  done.  He  did  not  tell  you, 
because  he  did  not  know,  that  right  on  that  hangs  the  life 
or  death  of  the  West  End  road.  Let  any  man  charged  with 
the  power  to  put  money  in  his  own  pocket,  as  I  have  said 
here,  say  to  the  West  End  Railroad,  Give  me  $100,000  for 
the  use  of  the  streets  from  the  northern  depots  to  the  south- 
ern depots  on  Washington  Street,  or  I  cancel  the  whole  of 
your  locations,  and  do  the  same  on  Tremont  Street,  for  a 
mile  long  on  each,  and  West  End  has  got  to  do  whatever 
the  government  or  the  party  having  the  power  says,  or  be 
kiUed. 

You  might  as  well  cut  a  man's  throat  and  tell  him  he  is 
alive  as  to  cut  a   mile  out  of    Tremont   and   Washington 


16 

streets,  and  take  up  the  tracks  of  the  railroad  if  it  does  not 
pay  for  it,  because  without  it  you  cannot  get  from  one  end 
to  the  other.  There  is  no  communication  between  the  two. 
Give  a  man  that  power  and  he  can  make  that  same  proposi- 
tion, and  the  company  has  got  to  pay  just  what  the  man  says 
or  it  is  dead ;  and  is  that  the  kind  of  power,  gentlemen,  you 
think  it  is  safe  to  leave  in  the  hands  of  anybody,  of  any  man 
who  is  interested  in  behalf  of  the  treasury  into  which  he  is 
going  to  pay  the  money  ? 

Where  you  see  a  fire  break  out  you  know  there  is  trouble 
there,  but  that  is  only  one  instance,  when  there  are  a  dozen 
where  the  trouble  does  not  break  out,  and  you  know,  with 
your  experience  of  life  and  city  government,  that  there  are 
ten  or  a  hundred  troubles  of  that  kind,  where  money  is 
undoubtedly  used,  that  never  come  to  the  surface.  It  is 
only  the  exception  that  bursts  out,  and  I  say,  take  your  St. 
Louis  case,  where  there  has  been  this  $210,000  misused,  or 
improperly  used,  and  before  your  ears  have  ceased  to  hear 
that,  then  comes  Elmira  up  to  the  same  kind  of  thing ;  and 
our  own  Boston  has  its  five-hundred-dollar  troubles.  All 
these  things  every  man  knows,  and  it  seems  to  me  that  every 
man  must  appreciate  the  folly  of  putting  the  subject  of 
money  into  the  hands  of  the  city  government  or  any  branch 
of  it ;  but  if  this  revolutionary  process  is  to  go  on  at  all,  give 
it  to  some  disinterested  judicial  body  that  the  community 
can  respect  and  the  corporations  can  respect,  and  all  would 
go  infinitely  better  than  it  would  if  it  were  managed  in  the 
manner  that  is  proposed.  But  the  whole  thing  is  wrong,  as 
I  shall  show  you. 

Now,  gentlemen,  I  have  one  other  subject  in  this  connec- 
tion. I  tell  you  this  is  but  the  entering  wedge ;  this  attempt 
to  put  into  the  hands  of  the  city  government  the  power  to 
take  money  is  all  wrong,  but  it  is  only  the  entering  wedge. 
It  is  started  on  the  street  railways ;  it  will  very  soon  start 
on  steam  railways.  Why,  gentlemen,  there  is  a  steam  rail- 
way in  the  city  of  Boston  that  crosses  the  Chelsea  bridge, 
and  on  the  twenty-eighth  of  February  it  shut  down  its  gates 
four  hours  out   of   eleven,  and   on   an   average   it   is   shut 


17 

between  two  and  three  hours.  Talk  about  horse-railroad 
cars,  that  are  serving  the  public  all  the  time,  obstructing 
the  streets.  Steam  railroads  do  it  still  more,  where  the 
public  service  of  carrying  freight  requires  it,  and  all  you 
have  got  to  do  is  to  simply  push  this  thing  one  step  farther 
and  you  have  extended  it  to  all  the  corporations  in  the  Com- 
monwealth, and  the  impolicy  of  it  is  sure  to  drive  all  the 
capital  out  of  the  Commonwealth. 

Now,  gentlemen,  we  have  been  told  here  that  the  city 
should  charge  rent.  The  city  has  nothing  whatever  to  rent. 
The  abutters  own  the  fee,  the  public  own  the  use  of  the 
streets,  and  the  municipal  corporation,  as  such,  has  nothing 
whatever  to  rent.  A  lease  made  by  the  city  would  not  be 
worth  the  paper  that  it  was  written  on,  for  it  has  nothing  to 
give.     It  cannot  lease. 

Representative* Kittredge.  What  do  you  mean  by  the 
public? 

Mr.  Proctor.  The  people,  every  one  in  the  Common- 
wealth, and  the  people  in  the  West  as  well  as  the  people 
in  the  East. 

I  will  quote  now,  for  your  pleasure,  Hampshire  v.  Frank- 
lin, 16  Mass.  84,  where  it  is  said,  "  It  is  not  in  the  power  of 
the  Legislature  to  create  a  debt  from  one  person  to  another, 
or  from  one  corporation  to  another,  without  the  consent, 
express  or  implied,  of  the  party  to  be  charged." 

Gentlemen,  I  dismiss  the  subject  of  rent  because  it  is,  to 
my  mind,  too  silly  to  be  thought  of.  The  only  thing  that  the 
Legislature  has  power  to  do  is  to  charge  a  consideration  for 
the  grant  that  it  gives  to  the  corporation.  It  first  creates 
the  corporation,  and  then  from  time  to  time  the  board  of 
aldermen,  representing  the  State,  gives  the  location.  They 
can  charge  then  what  the  State  requires  them  to,  and  that  is 
the  consideration  for  the  grant.  The  only  thing  left  for  the 
Legislature  where  they  can  take  anything  out  of  the  cor- 
poration is  to  tax  it.  They  can,  first,  tax  its  property ;  and 
they  can,  second,  tax  its  franchise. 

Jtepresentative  Quincy.  Then,  as  I  understand  your  posi- 
tion, it  is  that  the   board   of  aldermen   are   acting   as   the 


18 

agents  of  the  Commonwealth  and  not  as  the  representatives 
of  the  city  in  granting  the  location. 

Mr.  Proctor.  They  make  a  contract.  There  are  two 
parties  present.  There  is  the  horse  railroad,  on  one  hand ; 
there  is  the  State  represented  by  the  board  of  aldermen,  on 
the  other.  The  railroad  asks  for  a  location,  the  city  grants 
it,  the  horse  railroad  accepts  it,  and  that  acceptance  is  an 
agreement  that  they  will  build  the  track  —  in  other  words,  as 
I  call  it,  bury  their  capital  in  the  streets  —  and  run  their  cars. 
That  is  a  contract,  and  that  contract  must  not  be  confused 
with  the  corporation  contract  which  is  made  for  its  existence. 
When  the  Legislature  grants  a  charter  it  gives  existence  to 
an  artificial  creature.  That  is  one  contract,  you  may  call  it. 
From  day  to  day  locations  are  granted,  and  every  time  a 
location  is  granted  a  contract  is  made ;  and  you  must  not 
confuse  the  two. 

Representative  Quincy.  But  you  say  it  will  be  a  breach 
of  contract  to  revoke  the  locations  ? 

Mr.  Proctor.     I  will  give  you  the  law  on  that :  — 

1.  Neither  the  board  of  aldermen,  when  acting  solely  as 
municipal  officers,  nor  the  cities,  have  now  any  power  to 
grant  any  street  railway  location  or  to  require  money  to  be 
paid  into  the  city  treasury  for  any  street  railway  location. 
And  I  wish  to  read  very  briefly  from  the  case  of  Cambridge 
V.  the  Cambridge  Railroad,  10  Allen,  57.  That  was  a  case 
where  Cambridge  undertook  to  interfere  with  a  horse  rail- 
road. 

"  Certainly  no  right  or  authority  to  exercise  any  super- 
vision or  control  over  the  defendants,  or  to  require  them  to 
conduct  the  operations  of  their  road  in  any  manner  other 
than  is  deemed  expedient  or  proper  by  the  defendants,  or  to 
enforce  any  supposed  agreement  or  condition,  is  vested  in 
the  mayor  and  aldermen,  under  the  general  powers  and 
duties  devolved  on  them  by  law  as  o: :.cers  acting  for  the 
city.  Nor  is  there  any  such  right  or  authority  vested  in 
them  by  the  acts  incorporating  the  defendants.  So  far  as 
they  are  instructed  with  any  power  in  relation  to  the 
location   and  construction  of   the   road,  and   other  matters 


19 

connected  with  its  use,  these  duties  are  specifically  enumer- 
ated and  defined,  and  they  are  to  be  performed  by  them,  not 
as  officers  acting  for  or  representing  the  city,  but  as  a  body 
of  men  on  whom  certain  duties  of  a  ministerial  or  quasi- 
judicial  nature  are  by  law  devolved.  These  duties  have  no 
necessary  or  essential  connection  with  those  which  they  are 
called  on  to  perform  in  their  official  capacity  as  a  branch  of 
the  city  government.  They  might  have  been  imposed  as 
well  on  any  other  body  of  men,  if  the  Legislature  had  seen 
fit,  although  it  was  doubtless  wise  as  a  matter  of  convenience 
and  expediency  that  they  should  be  performed  by  those  who, 
in  their  official  connection  with  the  city,  would  be  more 
likely  to  discharge  them  without  difficulty  and  to  the 
advantage  of  the  public.  But  we  look  in  vain  for  any 
provision  of  law  which  authorizes  them  to  act  in  behalf  of 
the  city,  either  in  making  any  contracts  with  the  defendants, 
or  in  enforcing,  in  their  names. or  in  their  official  capacity,  any 
contract  created  by  law,  with  the  city  or  the  public,  under 
the  acts  incorporating  the  defendants.  If  the  conditions  on 
which  the  location  of  the  road  or  any  part  of  it  was  granted 

to  the  defendants  can  be  properly  regarded  as  a  contract 

a  point  not  necessary  now  to  determine  —  it  was  not  one  to 
which  the  mayor  and  aldermen  were  a  party,  or  which  they 
are  capable  of  enforcing.  They  were  merely  agents  in 
prescribing  the  terms  of  such  location,  with  specific  and 
limited  powers,  and  possessing  no  power  or  authority  beyond 
those  enumerated,  among  which  is  not  included  that  of 
maintaining  an  action  to  compel  the  defendants  to  comply 
either  with  the  terms  of  their  charter  or  the  conditions  on 
which  they  were  jjermitted  to  construct  their  tracks  through 
the  streets  of  a  city." 

That  states  the  position  of  the  board  of  aldermen  exactly 
and  there  can  be  no  f^uestion  about  it.  And  that  law 
remains  the  same  to-day.  I  will  read  a  short  extract  now 
from  Brimmer  v.  Boston,  102  Mass.  22. 

"  In  laying  out  ways  within  the  city  of  Boston,  the  board 
of  aldermen  have  similar  powers,  and  perform  like  duties,  as 
are  exercised  and  performed  by  the  county  commissioners 


20 

in  the  other  counties  of  the  State.  General  Statutes,  chapter 
43,  section  77.  In  the  exercise  of  these  powers  and  perform- 
ance of  these  duties,  they  act,  not  as  officers  or  agents  of  the 
city,  but  as  public  officers,  vested  with  quasi-judicial  functions, 
and  deriving  their  power  froin  the  sovereign  authority.  The 
board  of  aldermen  and  common  council,  in  laying  out  and 
constructing  ways,  are  not  subject  to  the  direction  or  con- 
trol of  the  inhabitants  of  the  city,  but  are  an  independent 
board  of  public  officers,  vested  by  law  with  the  control  of  all 
matters  within  their  jurisdiction,  and  performing  duties 
imposed  by  general  laws." 

There  are  other  cases  cited  on  my  brief,  which  I  shall  give 
you,  establisliing  what  the  law  is,  beyond  all  question.  I 
say:  — 

2.  Neither  the  board  of  aldermen,  when  acting  solely  as 
municipal  officers,  nor  the  cities,  have  the  power  to  revoke 
any  street  railway  location  merely  for  the  purpose  of  making 
a  new  location  in  the  same  street  or  requiring  money  to  be 
paid  therefor  into  the  city  treasury. 

3.  The  board  of  aldermen  appointed  by  the  Legislature 
to  make  locations  for  street'  railways  (whether  acting  as 
individuals,  or  as  trustees,  or  in  a  quasi-judicial  capacity) 
have  not  now  the  power  to  require  any  money  to  be  paid  into 
the  city  treasury  for  any  street  railway  location. 

4.  The  board  of  aldermen  appointed  by  the  Legislature  to 
designate  street  railway  locations  (whether  acting  in  their 
capacity  as  individuals,  or  as  trustees,  or  in  a  quasi-judicial 
capacity)  have  not  the  power  to  revoke  a  location  merely  for 
the  purpose  of  making  a  new  location  in  the  same  street  or 
requiring  money  to  be  paid  therefor  into  the  city  treasury. 

5.  The  present  power  of  the  boapd  of  aldermen  (in  what- 
ever capacity  they  act)  to  revoke  a  street  railway  location 
is  limited  to  the  present  statute  provisions,  stating  in  what 
cases  revocations  may  be  made.  They  act  under  special 
provisions,  and  that  case  that  I  read  covers  it ;  but  I  shall 
come  to  it  farther  on. 

6.  The  words  now"  in  the  statute,  "  if,  in  their  judgment, 
the  interests  of   the  people  so  require  "   (Public   Statutes, 


21 

chapter  113,  section   23),  have  been   judicially  defined   to 
mean  that  the  officers  are  to  exercise  the  power  "  as,  in  their 
judgment,  the  weight  of  the  public  convenience  in  the  use 
of  the   streets   may   require "    (Medford,   etc.,    Railroad   v. 
Somerville,  111  Mass.  232,  235).     You  will  see  that  their 
power  to  make  any  revocation  is  limited  to  what  they  think 
is  for  the  public  convenience  in  the  use  of  the  street,  and 
not  in  taking  money  out  of  somebody's  pocket  and  putting  it 
in  somebody  else's  pocket,  or  for  any  question  of  pecuniary 
consideration.     You  will  find  it  running  through  the  whole 
policy  of  the  Commonwealth,  — to  leave  the  city  to  regu- 
late the  use,  —  the  people  concurrently  using  it,  turning  out, 
and  all  that  sort  of  thing ;  but  there  is  not  an  instance  in  the 
history  of  the  Commonwealth  where  they  have  ever  crossed 
that  line  and  allowed  the  board  of  aldermen  of  a  city  to 
touch  the  question  of  money.     And  this,  therefore,  becomes 
very  important  in  any  bill  you  shall  make  here,  that  you 
shall  see  exactly  where  the  line  is  drawn  as  to  the  present 
powers.     The  present  power  of  revocation  is  hmited,  and 
the  power  is  limited  as  to  the  use  and  the  methods  of  use  in 
the  streets.    Certainly  the  Legislature  has  reserved  no  power 
in  this  respect ;  and  the  board  of  aldermen  is  in  the  same 
position  as  a  justice  of  the  peace  who  has  jurisdiction  for 
$100 ;  and  Brother  Wilson  —  although  he  did  not  do  it,  and 
would  not  do  it  —  made  a  writ,  setting  the  ad  damnum  at 
$1,000.     And  somebody  said,  "  Why,  j^our  Court  has  n't  got 
jurisdiction  ; "  and  he  went  in  to  amend  it,  and  the  Court 
said  it  had  n't  got  jurisdiction  enough  to  allow  him  to  amend 
it,  because  he  had  ruled   himself  out   of  Court   by  saying 
11,000  instead  of  $100.     Now  if  a  board  of  aldermen  should 
undertake  to  come  here  and  revoke  a  location,  from  any  ca- 
price it  saw  fit,  it  would  be  beyond  its  jurisdiction.     Its  juris- 
diction is  limited  to  the  use  of  the  street.     It  would  be  a 
most  preposterous   position   if    it   were   left   in   any   other 
way. 

Representative  Wilson.  You  do  not  understand,  do  you, 
that  if  they  should  assign  as  a  cause,  that  public  conven- 
ience required  it,  no  matter  what  their  real  intention  was, 


22 

that  their  judicial  finding  that  public  necessity  required  it 
would  be  conclusive  in  the  case  ? 

Mr.  Proctor.  Their  decision  would  be  good  for  nothing 
unless,  as  a  matter  of  fact,  they  kept  within  their  juris- 
diction ;  and  I  am  ready  to  say  that  no  board  of  aldermen 
can  act  on  a  question  of  this  kind  without  my  knowing  on 
what  ground  they  act.  The  mere  general  statement  will 
not  prevail.  And  I  do  not  believe  there  is  a  board  of 
aldermen  in  Massachusetts  that  would  be  dishonest  enough 
to  conceal  its  reason.  Some  of  them  certainly  would  state 
the  reason  ;  and  the  man  who  stated  a  reason  outside  of  the 
statute  provisions  to-day  pertaining  to  the  use  of  the  street 
would  be  an  honest  man,  and  that  statement  would  anni- 
hilate the  judgment,  if  it  were  not  within  that  line  as  to  the 
use  of  the  street,  if  it  were  a  mere  caprice,  or  if  it  were  that 
I  should  pay  f  100  into  the  city  treasury. 

(On  motion  of  Mr.  Kittredge,  the  hearing  was  then 
adjourned  to  2  p.m.) 

The  hearing  was  resumed  at  2.40  p.m..  Senator  West 
presiding. 

Mr.  Proctor.  On  the  subject  which  I  was  speaking  upon, 
namely,  the  use  of  the  street,  to  which  the  powers  of  the 
board  of  aldermen  are  confined  in  their  revocations,  I  wish 
to  say  that  2  Pick.  549  shows  that  public  convenience, 
as  to  whether  a  street  shall  be  laid  out,  totally  excludes 
money.  This  decision  finds  that  where  a  street  was  laid 
out  because  some  neighbor  gave  this  town  so  many  dollars 
for  doing  it,  a  certiorari  brought  it  up  to  the  Supreme  Court, 
and  the  Supreme  Court  said  it  was  illegally  laid  out  because 
it  was  laid  out  on  account  of  money  and  not  on  account  of 
the  public  use  of  the  street.  The  money  element  cannot 
enter  into  the  subject  of  the  use  of  a  street,  and  the  two 
things  must  be  kept  totally  distinct.  And  that  illustrates 
and  applies  to  this  subject  of  revocations  as  to  the  use  of 
the  street. 

In  the  case  of  Mayor  v.  The  Second  Avenue  Railway, 
32  N.  Y.  261,  it  was  held  that  an  ordinance  imposing  a 
license  duty  upon  city  cars  for  revenue  purposes  only  — 


23 

that  is,  money  in  the  treasury  —  is  not  an  ordinance  for 
police  and  internal  government ;  that  the  imposition  of  a 
tax  by  such  corporation  upon  a  railroad  company  in  deroga- 
tion of  its  rights — meaning  its  franchise  rights  —  for  pur- 
poses of  revenue  merely  is  unlawful  and  void.  And  what 
I  claim  is  that  any  bill  that  might  be  passed  by  this  Legisla- 
ture in  derogation  of  the  vested  rights  of  these  companies, 
for  the  sake  of  filling  the  treasury  merely,  would  be  illegal 
and  void. 

Senator  West.  Do  you  mean  to  say  that  the  West  End 
Railway  could  take  up  its  tracks  and  put  flat  surface  wheels 
upon  its  cars  and  haul  them  about  the  streets  of  the  city? 

Mr.  Proctor.  I  can  draw  any  kind  of  a  team  through  the 
street  if  I  do  not  obstruct  it.  A  teamster  who  drives  a  team 
through  the  city  does  it  for  hire.  There  is  one  broad  rule 
for  the  use  of  the  street.  There  is  no  qualification  of  that. 
The  only  difference  between  a  horse  railroad  and  a  teamster 
who  carries  for  hire  is  simply  the  privilege  of  laying  a 
track. 

Now  I  come  to  the  main  question  in  the  case :  if  the 
grant  by  the  charter  to  the  street  railway,  and  the  location 
and  its  acceptance,  and  its  burying  its  capital  in  the  street, 
never  to  return,  amount  to  a  contract  or  agreement  or 
understanding  that  the  location  is  to  be  permanent  if  the 
terms  are  complied  with,  then  the  Legislature  cannot  pass  a 
law  to  impair  that  contract,  agreement,  or  understanding. 
And  while  I  am  considering  this  I  want  you  distinctly  to 
remember  that  the  granting  of  a  right  to  exist,  made  in 
1859,  is  one  thing ;  a  location  made  by  a  board  of  aldermen, 
representing  the  State,  yesterday,  is  another  thing.  And 
when  I  am  speaking  of  a  contract  right  here,  I  am  speaking 
of  a  contract  right  which  is  made  when  the  location  is  made, 
between  the  corporation,  preexisting,  on  the  one  part,  and 
the  board  of  aldermen,  representing  the  State,  on  the  other. 
It  is  that  latter  contract  which  is  vested  and  which  cannot 
be  interfered  with.  In  Crease  v.  Babcock,  23  Pick.  234, 
Morton,  J.,  says,  "  That  a  charter  of  incorporation  is  a  con- 
tract l:)etween  the  government  and  the  corporators  is  a  prop- 


24 

osition  which  seems  to  be  fully  supported  by  the  highest 
judicial  authorities.  That  it  is  exempt  from  the  ordinary 
action  of  legislative  power,  beyond  the  reservations,  express 
or  implied,  contained  in  it,  is  equally  well  supported.  In 
other  words,  the  government  can  rightfully  do  nothing 
inconsistent  with  the  fair  meaning  of  the  contract  which  it 
has  made."  Then,  also,  in  Commonwealth  v.  Essex  Com- 
pany, 13  Gray,  253,  Shaw,  J.,  says :  — 

"  The  power  of  repeal  is  limited  and  qualified,  and  was  so 
considered  in  the  case  of  Crease  v.  Babcock,  23  Pick.  334. 

"  Does  this  come  within  the  power  of  the  Legislature  to 
amend  or  alter?  It  seems  to  us  that  this  power  must  have 
some  limit,  though  it  is  difficult  to  define  it.  Suppose  an 
authority  has  been  given  by  law  to  a  railroad  corporation  to 
purchase  a  lot  of  land  for  purposes  connected  with  its  busi- 
ness, and  they  purchased  such  a  lot  from  a  third  party, 
could  the  Legislature  prohibit  the  company  from  holding  it? 
If  so,  in  whom  should  it  vest?  or  could  the  Legislature 
direct  it  to  revest  in  the  grantor,  or  escheat  to  the  public, 
or  how  otherwise  ? 

"Suppose  a  manufacturing  company  incorporated  is 
authorized  to  erect  a  dam  and  flow  a  tract  of  meadow,  and 
the  owners  claim  gross  damages,  which  are  assessed  and 
paid.  Can  the  Legislature  afterwards  alter  the  act  of  incor- 
poration so  as  to  give  to  such  meadow  owners  future  annual 
damages  ?  "  These  corporatoi-s  have  put  their  money  in  and 
have  taken  what  was  agreed  to  be  given  them  for  that 
money.  The  rights  cannot  be  changed.  The  Court  goes  on  : 
"Perhaps  from  these  extreme  cases — for  extreme  cases  are 
allowable  to  test  a  legal  principle  —  the  rule  to  be  extracted 
is  this :  That  where,  under  power  in  a  charter,  rights  have 
been  acquired  and  become  vested,  no  amendment  or  altera- 
tion of  the  charter  can  take  away  the  property  or  rights 
which  have  become  vested  under  a  legitimate  exercise  of 
the  powers  granted."  And  the  right  that  we  claim  here  is 
this :  On  the  first  day  of  this  year,  say,  our  corporation  had 
been  existing  thirty  years.  That  corporation,  so  existing, 
on  that  day  made  a  contract  with  the  board  of  aldermen. 


25 

representing  the  State ;  that  contract  provided  that  if  we 
■accepted  the  location  as  they  gave  it,  subject  to  the  terms 
which  they  required,  and  we  put  our  money  into  the  track 
and  sleepers  and  run  our  cars,  we  should  have  that  right 
permanently.  That  is  what  the  contract  says.  That  is  what 
everybody  understands  it  means.  And  it  is  a  vested  right 
which  cannot  be  disturbed. 

Representative  Wihon.  Do  you  mean  to  say  by  that,  Mr. 
Proctor,  that,  where  a  board  of  aldermen  grants  a  location, 
that  location  cannot  be  wiped  out  by  a  discontinuance  of 
the  street? 

Mr.  Proctor.  Thank  you  for  coming  to  it.  I  have  a 
minute  here  to  come  to  it  later,  but  I  will  put  it  in  now  as 
long  as  you  have  asked  it.  The  Legislature,  well  knowing 
that  streets  would  sometimes  have  to  be  discontinued  where 
this  right  has  become  vested,  has  taken  the  precaution  to  put 
into  the  statute  under  which  we  take  the  locations  that  if  a 
street  is  to  be  discontinued  we  shall  not  claim  damages  of 
the  city  for  doing  it.  What  did  the  Legislature  put  that 
into  the  statute  for  if  they  did  not  recognize  our  vested 
rights  and  wish  to  prevent  us  from  getting  damages  when 
they  did  that?     That  is  my  answer  to  his  question. 

Representative  Kittredge.  Refer  me  to  that  section,  will 
you? 

Mr.  Proctor.  It  is  Public  Statutes,  chapter  113,  section 
31. 

Representative  Kittredge.  Did  these  votes  or  writings 
which  you  define  as  a  contract  under  these  decisions,  in  the 
case  of  your  railroad,  use  the  words  "permanent  location"? 

Mr.  Proctor.  I  do  not  know  that  the  word  "permanent" 
exists  anywhere  except  in  the  surrounding  circumstances. 
It  is  a  rule  of  law  that  where  a  grant  is  made  without  any 
limitation  it  is  permanent. 

Representative  Kittredge.  Then  it  is  u[)on  that  construc- 
tion in  the  case  of  a  grant  that  you  supply  the  word  "  per- 
manent "  ? 

Mr.  Proctor.  Yes.  exactly.  The  Legislature  frequently 
puts  in  a  limitation  of  fifty  or  seventy  years,  but  that  is  very 


26 

rare  in  this  Commonwealth,  because  it  is  not  politic,  it  is  not 
in  the  best  interests  of  the  community.  Stability,  honors 
and  confidence  between  people  bring  the  best  result  to  the 
community  and  to  everybody. 

Now,  gentlemen,  I  will  read  you  next  the  most  celebrated 
decision  upon  this  subject  within  my  knowledge,  and,  I 
think,  the  most  celebrated  in  existence.  You  all  remember 
the  Broadway  surface  road  and  the  boodle  aldermen  of  New 
York.  In  consequence  of  so  much  boodle,  the  Legislature 
passed  a  law  that  the  charter  of  that  corporation  should 
be  ended.  And  it  was  ended.  And  they  went  right  along 
and  passed  a  law  that  the  franchise  which  this  Broadway 
Surface  Corporation  had  in  its  possession  should  be  taken 
and  sold.  And  the  people,  by  the  attorney-general,  brought 
a  bill  in  equity  against  the  receiver  of  that  corporation  — 
for,  when  a  corporation  is  dead,  there  has  to  be  a  receiver 
to  represent  it  —  to  have  the  Court  decide  whether  that 
corporation,  under  the  existing  circumstances,  had  any 
vested  rights.  And  if  there  ever  was  a  case  where  a  Court 
would  decide  that  a  corporation  had  not  got  a  vested  right, 
it  would  be  that  one.  And  yet  the  Court  decided  that  that 
franchise  belonged  to  the  receiver,  and  that  he  should  take 
it  and  sell  it  and  pay  the  money  over  to  the  creditors  of  the 
corporation  and,  when  they  were  paid,  to  the  stockholders. 

The  Legislature  tried,  not  only  to  annihilate  the  corpora- 
tion, but  to  annihilate  the  right ;  and  the  Court  decided  that 
the  Legislature  was  correct  in  annihilating  the  existence  of 
the  corporation,  but  that  the  attempt  to  annihilate  the  right 
which  the  corporation  had  was  illegal  and  void,  and  that  the 
right  remained  with  the  receiver,  to  keep  and  sell. 

Representative  Kittredge.     Because  it  had  a  vested  right  ? 

Mr.  Proctor.     Because  it  had  a  vested  right. 

Representative  Kittredge.     Is  that  the  Court  of  Appeals? 

Mr.  Proctor.  Yes,  sir ;  it  is  111  N.  Y.  1.  I  have  only 
got  a  little  of  it  here.  It  was  a  very  long  decision.  The 
Court  says :  "  A  review  of  the  judgment  brings  up  for  con- 
sideration propositions  very  grave  in  character,  not  only  on 
account  of  the  extent  of  the  private  interests  affected,  but 


•    27 

because  their  determination  will  afifect  great  public  questions 
arising  out  of  the  limitations  imposed  by  the  Constitution 
upon  the  legislative  power  over  the  property  of  corpora- 
tions lawfully  acquired. 

"  The  statutes,  upon  which  the  action  is  predicated,  con- 
fessedly assume  the  right  and  power  of  the  Legislature  to 
wrest  from  the  company  its  franchises ;  to  transfer  them  to 
other  persons,  and  bestow  their  value  upon  the  donees  of  the 
State.  The  statutes  contemplate  the  absolute  destruction  of 
the  property  of  the  corporation,  and  the  loss  of  its  value  to 
the  creditors,  who  have  made  loans  in  good  faith  upon  the 
security  of  such  property,  and  this  action  is  avowedly  pros- 
ecuted to  accomplish  the  purpose  of  the  legislation.  It  is, 
therefore,  urgently  contended  by  the  attorney-general  that 
none  of  the  franchises  of  the  corporation  survived  its  disso- 
lution, and  that  the  mortgages  previously  given  thereon,  as 
well  as  all  contracts  made  with  connecting  street  railroads 
for  the  mutual  use  of  their  respective  roads,  fell  with  the 
repeal  and  could  not  be  enforced. 

"  If  it  could  be  supposed  for  a  moment  that  this  claim  was 
reasonably  supported  by  authority,  or  maintainable  in  logic 
or  reason,  it  would  give  grave  cause  for  alarm  to  all  holders 
of  corporate  securities. 

"■  The  contention  that  securities  representing  a  large  part 
of  the  world's  wealth  are  beyond  the  reach  of  the  protection 
which  the  Constitution  gives  to  property,  and  are  subject  to 
the  arbitrary  will  of  successive  Legislatures,  to  sanction  or 
destroy  at  their  pleasure  or  discretion,  is  a  proposition  so 
repugnant  to  reason  and  justice,  as  well  as  the  traditions 
of  the  Anglo-Saxon  race,  in  respect  to  the  security  of  rights 
of  property,  that  there  is  little  reason  to  suppose  that  it 
will  ever  receive  the  sanction  of  the  judiciary,  and  we  desire 
in  unqualified  terms  to  express  our  disapprobation  of  such  a 
doctrine.  Whatever  might  have  been  the  intention  of  the 
Legislature  or  even  of  the  framers  of  our  Constitution  in 
respect  to  the  effect  of  the  power  of  repeal  reserved  in  acts 
of  incorporation,  upon  the  property  rights  of  a  corporation, 
such  power  must  still  be  exercised  in  subjection  to  the 
provisions  of  the  Federal  Constitution. 


28 

"  Considering  the  power  which  the  State  has  to  terminate 
the  life  of  corporations  organized  under  its  laws,  and  the 
authority  which  its  attorney-general  has  by  suit  to  forfeit 
its  franchises  for  misuse  or  abuse,  and  to  regulate  and 
restrain  corporations  in  the  exercise  of  their  corporate 
powers,  there  is  little  danger  to  be  apprehended  in  the 
future  from  the  overgrowth  of  power,  or  the  monopolistic 
tendencies  of  such  organizations ;  but  whatever  that  danger 
may  be,  it  is  trivial  in  comparison  with  the  widespread  loss 
and  destruction  which  would  follow  a  judicial  determination, 
that  the  property  invested  in  corporate  securities  was  beyond 
the  pale  of  the  protection  afforded  by  the  fundamental  law. 

"It  is  not  perhaps  strange,  in  the  great  variety  of  cases 
bearing  upon  the  subject,  and  the  manifold  aspects  in  which 
questions  relating  to  corporate  rights  and  property  have  been 
presented  to  the  courts,  that  dicta,  couched  in  general  lan- 
guage, may  be  found  giving  color  to  the  plaintiff's  claim  ;  but 
we  think  that  there  are  no  reported  cases  in  which  the  judg- 
ment of  the  Court  has  ever  taken  the  franchises  or  property 
of  a  corporation  from  its  stockholders  and  creditors,  through 
the  exercise  of  the  reserved  power  of  amendment  and  repeal, 
or  transferred  it  to  other  persons  or  corporations,  without 
provisions  made  for  compensation. 

"  Judge  Comstock,  in  Davis  v.  Mayor,  etc.,  said,  '  As  the 
consideration  for  the  constructing  the  road,  the  ordinance 
clearly  contemplates  that  it  is  to  become  the  private  property 
of  the  associates.  They  alone  will  be  entitled  to  place  their 
cars  upon  it,  and  within  a  maximum  limit  they  can  charge 
what  they  please  for  the  carriage  of  passengers.  These  rights 
are  in  effect  granted  in  perpetuity'  "  (because  there  is  nothing 
to  limit  them). 

"In  the  case  of  Mayor,  etc.,  v.  Second  Avenue  Railroad 
Company  (32  N.  Y.  272),  it  was  said,  '  Assuming  that  the 
common  council  had  power  to  make  the  grant,  then  its  accept- 
ance by  Pearsall  and  his  associates,  signified  by  the  execution 
of  the  agreement  with  the  conditions  annexed  thereto,  and  the 
duties  and  obligations^  resulting  therefrom,  invested  the  latter 
with  the  right  of  property  in  the  franchise  which  the  common 


29 

council  could  not  take  away  or  impair  by  any  subsequent  act 
of  its  own.' 

"  When  we  consider  the  generality  with  which  investments 
have  been  made  in  securities  based  upon  corporate  franchises 
throughout  the  whole  country,  the  numerous  laws  adopted  in 
the  several  States  providing  for  their  security  and  enjoyment, 
and  the  extent  of  litigation  conducted  in  the  various  Courts, 
State  and  Federal,  in  which  they  have  been  upheld  and  en- 
forced, there  is  no  question  but  that,  in  view  of  legislatures, 
courts,  and  the  public  at  large,  certain  corporate  franchises 
have  been  uniformly  regarded  as  indestructible  by  legislative 
authority,  and  as  constituting  property  in  the  highest  sense 
of  the  term. 

"  It  is,  however,  earnestly  contended  for  the  State  that  such 
a  franchise  is  a  mere  license  or  privilege  enjoyable  during 
the  life  of  a  grantee  only  "  (you  will  notice  that  Brother  Rich- 
ardson speaks  of  it  as  a  license  in  his  opinion)  "  and  revocable 
at  the  will  of  the  State."  (That  is  the  position  taken  by  the 
petitioner  here:  that  it  is  something  revocable  h^  tlwSta,te») 
"  We  believe  this  proposition  to  be  not  only  repugoaiit  .i^  ., 
justice  and  reason,  but  contrary  to  thei  u^'ifofpi-cqursft' 
of  authority  in  this  country.  The  laws  oi  thid>'  State  iate 
made  such  interests  taxable,  inheritable,  alienable;  stibject  to 
levy  and  sale  under  execution,  to  condemnation  ^tiniifcf^^^il^^i 
exercise  of  the  right  of  eminent  domain,  and  invested  them 
with  the  attributes  of  property  generally."  (And  I  might 
say  here  that  our  Legislature,  in  the  Act  of  1889,  has  expressly 
provided  that  the  "franchise"  of  these  same  corporations 
should  be  mortgaged  to  secure  loans,  and  similar  authority 
has  existed  before  and  franchises  have  been  mortgaged.) 

"  In  Mayor,  etc.,  v.  Second  Avenue  Railroad  Company  (32 
N.  Y.  261),  Judge  Brown  said:  'The  rights  of  municipal 
corporations  to  property  in  lands  and  its  usual  incidents,  and 
to  create  ferries  and  railroad  franchises,  are  quite  distinct  and 
separate  from  their  duties  as  legislatures  having  authority  to 
pass  ordinances  for  the  control  and  government  of  persons 
and  interests  within  the  city  limits.  The  latter  are  powers 
held  in  trust,  as  all  legislative  powers  are,  to  be  used  and 


30 

exercised  for  the  benefit  and  welfare  of  the  whole  community, 
while  the  former  are  property  in  the  ordinary  sense,  to  be 
acquired  and  conveyed  in  the  same  manner  as  natural  persons 
acquire  and  transfer  property.'  ♦ 

"  The  same  learned  judge  said  in  Brooklyn  Central  Rail- 
road Company  v.  Brooklyn  City  Railroad  Company,  32  Barb* 
364"  (I  beg  you,  gentlemen,  to  notice  this,  because  it  is 
exactly  what  I  said  here  this  morning)  :  " '  The  grant  to  the 
City  Railroad  Company  and  its  acceptance  on  the  conditions 
annexed  with  the  duties  and  obligations  and  large  expendi- 
tures resulting  therefrom,  would  seem,  therefore,  upon  the 
principles  I  have  endeavored  to  state,  to  invest  the  company 
with  the  right  of  property  in  the  franchise,  of  which  it  can- 
not be  deprived  without  its  consent  or  against  its  will.' 

"The  case  of  N.  O.  S.  F.  &  Lake  R.  R.  Co.  v.  Delamore, 
114  U.  S.  501,  is  directly  in  point.  There  the  franchise,  as 
here,  was  acquired  by  the  corporation  from  the  municipal 
authorities  of  a  city  under  general  laws  authorizing  the  for- 
mation of"  st-veet  railroad  corporations.  It  was  held,  '  where 
tb^re  ^ud  been  a  judicial  sale  of  railroad  property  under  a 
pjortgage,"  aul&ionzed  by  law,  covering  its  franchises,  it  is 
nGw  ^ell'setjtled  that  the  franchises  necessary  to  the  use  and 
enjoyment  (>f' the  railroad  pass  to  the  purchaser.  It  follows 
'^hai  if  th'e  franchises  of  a  railroad  corporation,  essential  to 
the  use  of  its  road,  and  other  tangible  property,  can  by  law 
be  mortgaged  to  secure  its  debts,  the  surrender  of  its  prop- 
erty upon  the  bankruptcy  of  the  company  carries  the  fran- 
chises and  they  may  be  sold  and  pass  to  the  purchaser  at  the 
bankruptcy  sale.' 

"  The  power  to  repeal  the  charter  of  a  corporation  cannot, 
upon  any  legal  principle,  include  the  power  to  repeal  what  is- 
in  its  nature  irrepealable,  or  to  undo  what  has  been  lawfully 
done  under  power  lawfully  conferred.  Butler  v.  Palmer,  1 
Hill,  335.  "  (So  if  powo'  has  been  given  to  lay  a  track  in  a 
street,  at  large  expense,  in  pursuance  of  a  contract  between 
two  parties,  the  law  recognizes  the  property  in  the  right,  and 
it  cannot  be  destroyed.) 

"  Since  the  decision  of  the  celebrated  Trustees  Dartmouth 


31 

College  V.  Woodward,  4  Wheat.  518,  the  doctrine  that  a 
grant  of  corporate  powers  by  the  sovereign,  to  an  association 
of  individuals,  for  public  use,  constitutes  a  contract,  within 
the  meaning  of  the  Federal  Constitution,  prohibiting  State 
Legislatures  from  passing  laws  impairing  its  obligations,  has, 
although  sometimes  criticized,  been  uniforml}-  acquiesced  in 
by  the  Courts  of  the  several  States  as  the  law  of  the  land, 
and  may  be  regarded  as  too  firmly  established  to  admit  of 
question  or  dispute. 

"If  it  is  possible  to  conceive  the  idea  of  a  repealable 
grant"  (notice  this  language)  "certainly  such  a  grant, 
accompanied  with  power  to  convey  or  pledge  the  interest 
granted,  must,  on  the  execution  of  the  power,  necessarily 
preclude  a  resumption  by  the  grantor  of  the  subject  of  the 
grant,  or  any  right  of  property  acquired  under  it."  (Right 
there,  let  me  say,  the  moment  that  we  comply  with  the  terms 
of  our  contract  and  put  our  money  into  the  street  and  run 
our  cars,  our  property  is  as  firmly  fixed  as  any  real  estate  we 
own.  The  Judge  continues) :  "  An  express  reservation  by 
the  Legislature  of  power  to  take  away  or  destroy  property 
lawfully  acquired  or  created  would  necessarily  violate  the 
fundamental  law,  and  it  is  equally  clear  that  any  legislation 
which  authorizes  such  a  result  to  be  accomplished  indirectly  " 
(I  beg  you  to  notice  this)  "  would  be  equally  ineffectual  and 
void."  (The  importance  of  this  is  that  you  cannot  make  a 
bill  here  that  is  of  any  value  —  and  I  want  a  good  one,  a 
square  one,  if  any  —  unless  you  keep  within  the  lines  of  what 
is  established  law.) 

"  In  Commonwealth  v.  Essex  Co.,  13  Gray,  239,  Justice 
Shaw  said:  'When,  under  power  in  a  charter,  rights  have 
been  acquired  and  become  vested,  no  amendment  or  altera- 
tion of  the  charter  can  take  away  the  property  or  rights 
which  have  become  vested  under  a  legitimate  exercise  of  the 
powers  granted.'  "  (Now,  if  they  want  Massachusetts  law, 
let  them  take  that.) 

"  Judge  Cooley  says  "  (you  will  all  know  who  he  is,  now 
head  of  the  Inter-State  Commerce  Railroad  Commission) :  " '  It 
cannot  be  necessary  at  this  day  to  enter  upon  a  discussion  in 


32 

denial  of  the  right  of  the  government  to  take  from  either 
individuals  or  corporations  any  property  which  they  may 
rightfully  have  acquired.  In  the  most  arbitrary  times  such 
an  act  was  recognized  as  pure  tyranny,  and  it  has  been  for- 
bidden in  England  ever  since  Magna  Charta,  and  in  this 
country  always.'  "  (And  we  will  be  proud  of  our  country. 
And  the  day  when  you  disobey  that  rule  you  might  well  be 
ashamed  of  your  country.) 

Representative  Kittredge.     If  not  of  ourselves. 

Mr.  Proctor.  The  Court  continues  :  "  It  is  immaterial  in 
what  way  the  property  was  lawfully  acquired,  whether  by 
labor  in  the  ordinary  avocations  of  life,  by  gift  or  descent,  or 
by  making  a  profitable  use  of  a  franchise  granted  by  the 
State  "  (and  the  profitable  use  of  it  is  to  bury  our  capital  in 
the  street  and  run  cars  as  we  agreed  to),  "  it  is  enough  that 
it  has  become  private  property,  and  it  is  thus  protected  by 
the  law  of  the  land. 

"Judge  Thompson  said  in  Dash  v.  Van  Vleeck,  7  John. 
477 :  '  It  is  repugnant  to  the  first  principles  of  justice,  and 
the  equal  and  permanent  security  of  rights,  to  take  by  law 
the  property  of  an  individual  without  his  consent  and  give 
it  to  another.' 

"In  New  York  and  Oswego  Midland  Railroad  Company 
V.  Van  Horn,  57  N.  Y.  473,  it  was  held  that  a  legislative 
intent  to  violate  the  Constitution  will  not  be  assumed,  nor 
will  a  law  be  so  construed  as  to  give  it  a  retroactive  effect 
when  it  is  capable  of  any  other  construction ;  and  that  if  all 
of  its  language  can  be  satisfied  by  giving  it  prospective 
operation  only  that  construction  will  be  given  to  it."  (Why, 
I  have  heard  one  of  the  laymen  on  this  Board  here  say  —  I 
do  not  now  remember  who  it  was  —  that  the  day  never 
would  come  when  he  would  vote  to  take  away  private  prop- 
erty without  compensation  for  it.  And  that  layman,  in  my 
judgment,  knows  a  great  deal  more  law  than  a  good  many 
that  have  appeared  before  this  Committee.) 

Representative  Kittredge.     That  is  sound  law. 

Representative  Wilson.  You  are  not  alluding  to  the  legal 
profession  on  the  Committee  ? 


33 

Mr.  Proctor.  Oh,  no.  I  said  "outside."  The  Court 
continues :  "  In  the  case  of  Dash  v.  Van  Vleeck  (supra),  it 
was  decided  that  it  is  a  principle  of  universal  jurisprudence 
that  laws,  civil  and  criminal,  must  be  prospective,  and  can- 
not have  a  retroactive  effect."  (You  see  that  is  just  what 
is  proposed  here,  to  revoke  a  grant  made  a  long  time 
ago,  for  the  purpose  of  granting  it  over  again  and  getting 
some  money.  We  might  almost  cry  out,  "  Venal  Rome  ! ") 
The  Court  says,  in  continuation  :  "  And  in  Benton  v.  Wick- 
wire,  54  N.  y.  229.  the  Court  declared  that  neither  original 
statutes  nor  amendments  can  have  any  retroactive  effect. 

"  We,  therefore,  think  this  law  is  obnoxious  to  the  objection, 
that  it  assumes  to  take  property  without  due  process  of  law, 
and  impairs  the  obligation  of  contracts." 

I  consider  this  case,  so  recent  and  so  comprehensive,  con- 
clusive upon  this  subject.  And  Massachusetts  law  is  in 
accord  with  it. 

I  am  not  going  to  read  this  ;  I  am  Only  going  to  call  your 
attention  to  a  case  (20  N.  J.  Equity,  QQ^.  It  is  to  this 
effect :  "  The  municipal  government  has  power  to  discharge 
the  company  to  whom  permission  to  lay  rails  in  the  streets 
was  granted,  from  the  condition  contained  in  the  contract, 
and  when  once  discharged,  cannot  again  make  the  company 
subject  to  the  condition."  They  have  granted  a  right, 
subject  to  a  condition.  They  have  relieved  the  company  of 
the  burden  of  the  condition  of  letting  another  company  run 
over  it ;  and  then  they  undertake  to  put  it  on  again,  and 
the  Court  says,  "  No  ;  when  you  took  it  off,  they  had  an 
unconditional  grant,  and  you  cannot  do  anything  to  inter- 
fere with  their  rights  in  that  unconditional  grant." 

A  case  was  referred  to  here  (101  U.  S.  528)  in  Mr. 
Richardson's  brief.  He  referred  to  it  as  one  of  the  excep- 
tions. Now,  according  to  my  view,  it  is  no  exception  at  all. 
It  was  a  question  of  taxation  and  had  nothing  to  do  with  a 
franchise  grant;  and,  of  course,  the  government  have  always 
the  right  to  tax  as  much  as  they  please,  subject  to  the  con- 
stitutional limitations.  But  the  question  of  franchise  grant 
is  a  totally  different  subject. 


34 

Now,  if  the  Committee  are  not  tired,  I  will  read  one  page 
from  1  Dillon's  Municipal  Corporations,  section  68,  a  note 
(p.  116,  4th  ed.)  :  "  The  extent  and  limits  of  legislative 
power  over  corporations  and  their  rights  and  the  rights  of 
their  mortgagees  and  of  persons  having  contracts  with  the 
dissolved  corporations  underwent  the  most  thorough  and 
deliberate  consideration  of  the  Court  of  Appeals  of  New 
York  in  the  Broadway  Surface  Railway  case,  People  v. 
O'Brien,  Receiver,  etc.,  Ill  N.  Y.  1  (1888)."  .  .  .  "The 
Court  held  that  the  franchise  of  the  corporation,  under  its 
charter,  and  the  grants  from  the  municipal  authorities  to  lay 
down  tracks  and  operate  its  railroad  was  a  property  right 
which  survived  the  dissolution  of  the  corporation ;  so  were 
the  rights  of  the  corporation  under  its  contract  with  con- 
necting railroads,  and  also  the  rights  of  the  mortgagees  to 
the  continued  use  of  the  street  in  connection  with  the 
railroad,  under  the  municipal  consent  to  the  use  thereof  for 
railway  purposes.  The  special  provisions  of  the  repealing 
act  as  to  winding  up  the  affairs  of  the  dissolved  corporation 
and  disposing  of  and  distributing  its  property  were  held  to 
be  unconstitutional." 

And  this  Mr.  Dillon  is  one  of  the  most  eminent  judges  in 
the  United  States  Circuit  Court. 

In  2  Gray,  339,  where  a  bridge  charter  was  granted  for  a 
bridge  with  draws  thirty  feet  wide,  and  the  Legislature 
undertook  to  require  them  to  be  made  sixty  feet  wide  after- 
wards, the  Court  held  that  the  acceptance  of  the  charter  and 
the  construction  of  the  bridge  was  a  contract  between  the 
corporation  and  the  government,  by  the  terms  of  which,  as 
contained  in  the  charter,  both  parties  were  equally  bound ; 
and  that  the  Act  of  1851  was  ineffectual  to  compel  the 
construction  of  a  draw  sixty  feet  wide. 

Then  a  word  from  the  case  of  the  Coast  Line  Railway  v. 
the  City  of  Savannah,  30  Federal  Reports,  646.  The  city  of 
Savannah  adopted  an  ordinance  indicating  a  route  for  the 
railroad,  with  many  terms  and  conditions;  and,  among 
others,  the  following  clause :  "  In  the  event  of  the  paving 
by  the  city  of  the  whole  or  any  portion  of  the  streets  used 


35 

by  said  railroad  company,  the  portion  of  the  track  between 
the  rails  shall  be  paved  and  kept  in  good  order  and  repair  by 
the  company  at  its  own  expense."  And  because  the  Legis- 
lature afterwards  passed  an  Act  authorizing  the  City  of 
Savannah  to  require  the  railroad  to  pave  not  only  between 
its  tracks  but  three  feet  on  each  side,  this  Act  to  increase 
the  width  was  held  to  be  unconstitutional. 

The  fact  is,  we  in  Massachusetts  have  been  so  in  the  habit 
of  doing  everything  about  the  street  that  the  good  public 
wanted  to  have  us,  that  we  have  never  raised  any  question 
of  law,  and  we  never  want  to.  We  want  to  live  in  peace 
with  the  people  we  have  to  deal  with. 

Representative  Kittredge.  You  mean,  if  it  takes  the  law 
to  compel  you  to  do  it  ? 

Mr.  Proctor.  Unless  somebody  comes  up  to  the  Legisla- 
ture and  wants  to  bleed  us  to  death,  and  then  we  have  to 
give  them  the  law.  This  Act  that  I  have  just  referred  to 
was  held  to  be  unconstitutional  by  the  United  States  Court, 
as  impairing  the  obligation  of  contracts.  The  Court  said 
that  a  reservation  to  the  State  of  a  right  to  withdraw  the 
franchise  of  a  company  affects  only  matters  derived  from 
its  act  of  incorporation  :  and  the  State  cannot  annihilate 
contracts  made  by  the  company. 

Jtepresentative  Kittredye.  Then,  Mr.  Proctor,  as  I  under- 
stand the  legal  position  which  you  lay  down  as  a  guide  for 
this  Committee,  it  is  this,  or  in  effect,  this :  that  it  would  be 
unnecessary  for  the  Legislature  to  make  any  provision  for 
any  greater  permanency  for  the  existing  charters  of  the 
horse  railroads  that  you  represent? 

Mr.  Proctor.  I  think  it  would  be  unnecessary  to  have 
any  farther  legislation  to  secui-e  our  rights.  But  so  many 
wise  young  men  have  stated  to  the  public  in  this  room  and 
elsewhere  that  we  have  not  vested  rights,  and  the  question 
is  so  far  raised  already  in  the  p'  l)lic  mind  that  it  has  affected 
stocks  and  affected  capital  more  or  less  already,  and  from 
the  fact  that  that  sort  of  mischief  is  done  (although  the 
legal  position  is  all  right)  —  from  the  fact  that  the  poison  has 
gone  forth  into  the  public  mind  which  impairs  and  greatly 


36 

injures  this  property  —  if  you  make  any  legislation  at  all, 
I  shall  ask  you,  in  amendments  which  I  have  prepared  to 
the  city  bill,  to  put  in  such  phrases  as  will  leave  no  question 
for  the  period  of  time  named  in  the  bill.  I  think  it  is  no 
more  than  just  and  fair  that  when  a  wrong,  or  what  I  call  a 
wrong,  has  been  done,  it  should  be  corrected.  And,  there- 
fore, I  shall' ask  for  certain  amendments  in  any  bill  that  you 
may  make,  if  you  make  anj'-,  which  will  put  at  an  end  that 
question  in  the  public  mind,  both  as  it  affects  capital  and 
other  interests. 

Representative  Kittredge.  Then,  Mr.  Proctor,  on  your 
view  of  the  law,  it  would  be  a  dangerous  admission  for  the 
West  End  Railroad  Company  or  the  Boston  &  Lynn  Rail- 
road Company  to  accept  any  new  charter  or  provision  from 
the  Legislature  looking  to  any  greater  permanency  in  their 
charters  or  locations  ? 

Mr.  Proctor.  Not  the  slightest.  The  best  title  I  could 
have  to  any  piece  of  land  in  Boston  is  not  so  good  but  that 
if  any  neighbor  comes  and  says  he  has  got  any  kind  of  a 
claim  on  it  —  although  there  is  none  at  all  —  I  should  be 
exceedingly  glad  to  get  a  release  from  him.  I  believe  in 
quieting  titles  when  there  is  no  necessity  for  anything  dif- 
ferent ;  and  I  believe  the  unquietness  that  has  been  created 
should  be  corrected. 

Mr.  Harding  cited  two  cases,  96  U.  S.  499  and  the  15th 
Wallace,  454,  neither  of  which  cases  has  anything  to  do 
with  a  franchise  right  in  a  street  railway  and  only  relates  to 
a  question  of  taxes,  and  that  section  was  in  the  original 
charter  which  gave  them  their  existence,  and  the  question 
came  up,  whether  there  was  a  right  of  repeal,  the  same  as 
there  is  in  this  State,  and  they  did  repeal  the  section  or 
they  decided  that  they  had  a  right  to.  But  we  do  not  claim 
that  in  our  original  charter  which  gave  us  our  existence  the 
Legislature  has  not  the  power  to  repeal  it.  We  are  willing 
you  should  destroy  us,  but  when  you  touch  a  contract  that 
we  have  made  after  we  came  into  existence,  with  another 
party.  Commonwealth,  mortgagee,  lessee,  contractee  of  any 
kind,  then  we  say.  Do  not  dare  to  lay  your  hand  on  that 


37 

contract,  for  it  is  a  contract  right ;  it  is  property  as  much  as 
a  horse  bought  and  paid  for. 

I  will  read  from  these  decisions  that  he  cites.  "Rights 
acquired  by  third  parties  and  which  have  become  vested 
under  the  charter  in  the  legitimate  exercise  of  its  power 
stand  upon  a  different  footing "  ;  and  then  again,  in  this, 
"  Rights  and  interests  acquired  by  the  company  not  con- 
stituting a  part  of  the  contract  of  incorporation "  — just 
like  all  rights  that  have  nothing  to  do  with  tlie  acts  of 
incorporations,  —  rights  acquired  subsequently,  —  "  stand 
upon  a  different  footing,"  but  no  such  rights  or  interests 
are  involved  in  those  cases ;  therefore  these  decisions  have 
nothing  to  do  with  this  case  whatever. 

I  pass  on  to  the  next  point.  My  next  point  is  that  the 
bills  proposed  here  — except  the  mayor's  —  by  either  im- 
pliedly giving  power  to  revoke  locations,  or  by  impliedly 
saying  that  such  power  exists,  do  attempt  to  impair  that 
contract  by  giving  power  to  require  money  to  be  paid  into 
the  city  treasury  for  a  location  which  is  only  to  take  the 
place  of  an  old  location,  the  terms  of  which  have  been  fully 
complied  with  by  its  possessor. 

Under  that  I  shall  allude  to  the  various  bills  very  briefly. 
The  Maiden  bill  has  the  credit  of  being  frank.  It  states 
right  out  what  it  means.  It  has  all  the  disadvantages  which 
I  spoke  of  in  opening  — the  disadvantage  of  interfering 
with  vested  rights  and  the  disadvantage  of  having  no 
appeal  provided  for.  The  city  bill  of  last  year  which  has 
been  presented  here  belongs  in  the  same  category  and  needs 
no  further  comment.  I  think  all  I  have  said  applies  to  it 
and  shows  that  it  is  one  that  ought  not  to  be  reported. 

Now,  gentlemen,  I  must  hasten  on.  Germane  to  this 
same  question  of  the  vested  interest  Mr.  Richardson  says 
what  is  given  for  a  franchise  right  is  no  tax,  but  a  pay- 
ment,—just  what  I  told  you  this  morning,  and  I  exactly 
agree  with  him.  Whatever  is  given  or  agreed  to  be  done, 
such  as  building  the  track  in  the  street,  at  the  time  the  loca- 
tion is  made,  is  the  consideration  for  the  grant.  It  is  a  pay- 
ment at  that  time,  and  it  is  not  a  tax.     The  tax  comes  in 


38 

later.  The  tax  comes  in  in  such  provisions  as  he  has  pro- 
vided in  his  opinion.  He  speaks  of  three  licenses  and 
rather  implies  that  our  franchise  right  is  a  license,  but  he 
will  not  differ  with  me  in  the  law  that  a  license  granted 
may  be  revocable  but  a  license  granted  and  acted  upon,  with 
money  spent  on  the  strength  of  it,  becomes  a  grant.  It  is 
no  longer  revocable.  And  then  there  is  a  license  coupled 
with  an  interest  that  cannot  be  revoked  by  the  grantor,  but 
a  license  that  is  acted  upon  and  a  consideration  paid  and 
work  done,  the  contract  carried  out  —  that  license  becomes 
a  grant.  Therefore  it  is  totally  immaterial  whether  you 
call  the  thing  a  grant  or  a  license,  but  it  has  been  sought 
to  diminish  the  size  of  the  riglit  by  calling  it  a  license, 
but  it  does  not  amount  to  anything ;  whichever  way  you 
look  at  it,  license  and  grant  is  the  same  thing  if  it  is  acted 
upon. 

Another  confusion  that  has  crept  in  here  a  great  many 
times  :  The  word  "  city  "  means  several  things..  One  mean- 
ing is  territory,  another  meaning  is  the  people  in  the  terri- 
tory, another  meaning  is  the  municipal  corporation,  and  that 
municipal  corporation  has  two  features  in  it.  One  is  the 
owner  of  property  —  it  owns  the  city  hall ;  another  is  a  legis- 
lative body  ;  and  the  word  "  city  "  is  used  in  these  four 
different  senses,  and  sometimes  they  are  all  confused  in  the 
bills. 

Now,  gentlemen,  I  want  to  come  to  a  matter  on  those 
vested  rights  that  is  pretty  important.  I  say  it  is  conclu- 
sive, and  so  will  you.  Ai^sume,  if  you  please,  that  every 
street  railroad  in  Massachusetts  has  made  a  mortgage  and 
has  mortgaged  its  franchise  to  somebody  and  got  the  money 
on  it.  Nobody  doubts  that  that  is  a  contract.  The  decision  I 
have  just  read  covers  it  exactly.  That  is  a  contract  between 
the  corporation  and  a  third  party,  and  even  Mr.  Harding's 
decision  expressly  provides  for  that.  Everybody  who  knows 
any  law  knows  that  that  is  a  separate  contract  and  has  no- 
thing to  do  with  the  government,  and  the  Legislature  has 
authorized  these  street  railways  to  make  the  mortgages ; 
they  have  sanctioned  the  mortgages ;  and,  what  is  more  than 


39 

that,  gentlemen,  let  me  read  you  what  the  Legislature  says : 
"  Said  bonds  shall  be  secured  by  a  mortgage  of  a  part  or  the 
whole  of  the  railway  property  of  such  company  and  its 
equipments,  franchise,  and  other  property,  real  and  per- 
sonal." And  do  you  suppose  the  Legislature  is  going  to,  or 
could,  authorize  its  franchise  to  be  mortgaged  to  a  money- 
lender and  as  soon  as  thej'^  have  got  the  money  turn  round 
and  annihilate  it?  It  is  too  absurd  and  preposterous  to 
think  of  for  a  moment.  When  a  horse  railroad  has  mort- 
gaged its  franchise  with  the  assent  of  the  Legislature,  that 
mortgage  stands,  and  the  mortgagee  stands  with  control 
over  that  franchise  right  beyond  which  the  power  of  the 
Legislature  cannot  go.  I  say  you  cannot  proceed  against 
the  vested  right  as  against  the  stockholder,  but  as  against 
the  mortgagees  to  whom  the  stockholders  have  sold  the  prop- 
erty with  the  express  approbation  of  the  Legislature  for 
value  received ;  they  have  got  a  title  there  is  no  power  on 
Beacon  Hill  can  disturb. 

But,  gentlemen,  that  is  not  all.  Another  subject :  A 
large  part  of  the  rights  in  this  State  are  held  by  lessees,  who 
stand  in  a  similar  position  to  mortgagees,  and  those  lessees 
got  their  title  to  this  property  under  that  authority,  special 
authority  and  direction  of  the  Legislature,  of  the  Common- 
wealth. We  own  all  our  railroad  from  Revere  to  Vine 
Street  in  Charlestown  by  a  lease,  and  that  lease  is  made  with 
the  special  authority  of  the  Legislature,  the  Commonwealth, 
and  we  hold  that  title  the  same  as  the  mortgagees  hold 
their  title.  It  has  been  sold  to  us,  and  we  have  a  right 
to  it. 

I  come  to  the  next  question,  and  that  is  that  we  own  a 
vested  right  in  five  miles  over  the  Salem  turnpike,  from  Vine 
Street  in  Charlestown  to  Swampscott,  that  we  bought  of  the 
Salem  turnpike  and  paid  for,  and  we  own  it  as  any  man 
owns  a  right  that  he  has  bought  and  paid  for. 

Representative  Q^dncy.  Bought  of  the  Salem  turnpike 
corporation  ? 

Mr.  Proctor.  Yes ;  and  the  Legislature  in  our  charter 
specially  authorized  us  to  buy  it,  and  we  bought  it  and  paid 


40 

for  it,  and  we  own  it,  and  no  man  will  dare  to  question  that 
we  own  that  as  much  as  any  man  owns  his  house. 

I  will  read  this  decision  in  Lynn  &  Boston  Railroad  Com- 
pany V.  Lowell  Railroad  Corporation,  114  Mass.  92.  The 
Court  says:  "The  plaintiffs  rely  upon  the  proviso  intro- 
duced by  the  last-named  act,  which  is  as  follows :  '  Provided 
that  said  highway  shall  be  subject  to  all  the  leasehold  and 
chartered  rights  and  liabilities  of  the  Lynn  &  Boston  and 
the  Boston  &  Chelsea  railroad  corporations.' " 

We  claimed  that  we  had  such  a  right  in  the  street  that 
the  Boston  &  Lowell  Railroad  could  not  get  across  Chelsea 
Bridge,  and  what  we  were  driving  at  was  to  prevent  their 
crossing  there,  but  the  Court  said  we  could  not,  but  we 
bought  and  paid  for  a  concurrent  right  with  the  public  in 
that  street,  and  we  own  it  as  much  as  any  man  owns  his 
house,  and  there  is  no  question  about  that;  and  you  will 
see  the  importance  of  this  in  another  connection  where 
somebody  —  Brother  Harding,  I  think  it  is  —  wants  to  make 
a  charge  based  on  the  gross  income.  Well,  I  should  like  to 
see  him  make  a  charge  on  our  income  on  the  Salem  turnpike 
right.  Whatever  that  five  miles  earns  is  ours,  and  there  is 
no  power  on  earth  can  interfere  with  it ;  but  I  cannot  tell 
how  much  of  our  earnings  comes  from  that  part  of  our  road, 
nor  can  anybody  else,  and  if  you  are  going  to  base  —  I  do 
not  suppose  you  will,  but  I  want  you  to  see  the  folly  of  it  — 
if  you  are  going  to  base  any  bill  on  the  gross  earnings,  you 
will  have  hard  work  to  have  it  go  through,  and  I  think  it 
would  be  unconstitutional. 

Now  these  gentlemen  come  up  here  and  say,  ''  More 
money,  more  money,"  and  they  say,  "  You  have  got  no  contract, 
and  we  will  have  more  money  because  you  have  no  contract ;  " 
and  when  we  tell  them  we  will  discontinue  running  through 
the  streets  they  say,  "  There  is  a  contract.  You  have  got  to 
run  your  cars."  If  we  should  stop  running  our  cars,  there 
would  be  such  a  howl  among  the  people  that  we  could  not 
live. 

Representative  Kittredge.  Why  would  not  that  be  a  good 
way  to  test  this  whole  question  ? 


41 

Mr.  Proctor.  We  should  not  dare  to.  No ;  in  the  din 
that  would  be  raised  I  would  lose  what  little  power  of  hear- 
ing I  have  left  now,  and  that  is  none  too  much. 

Now,  gentlemen,  I  come  to  the  second  point.  I  was  very 
glad  to  hear  the  mayor  say  that  the  board  of  aldermen  of 
this  year  never  would  be  guilty  of  revoking  a  right  for  the 
sake  of  getting  some  money.  I  want  you  all  to  remember 
it.     I  do  not  believe  any  board  of  aldermen  would  do  it. 

Now  I  was  saying  to  you  that  I  had  threshed  this  whole 
subject  over  for  ten  years,  but  it  never  has  come  up  with  the 
poison  quite  so  virulent  as  it  is  this  year.  Last  year  we 
brought  up  the  taxpayers  before  the  Committee,  and  we 
brought  up  a  strong  petition  from  the  Laborers'  League  and 
a  petition  from  the  employees  of  our  road,  and  we  brought 
these  people  all  up  here,  and  I  should  have  brought  them 
before  this  Committee  only  we  never  would  have  got  through 
if  we  brought  them  this  year  ;  but  last  year  they  were  here, 
and  every  one  of  them  took  the  ground  that  they  did  not 
want  the  bill,  and  the  mayor  of  the  city  of  Lynn  was  really 
ashamed  of  it  before  he  got  through.  That  was  a  special 
provision  for  the  city  of  Lynn  alone. 

Now  I  will  hasten  on  to  what  is  the  second  point  in  this 
brief.  Irrespective  of  what  the  law  is,  all  grants  and  loca- 
tions and  the  acceptance  of  them,  and  burying  capital  in 
the  street,  have  been  made  upon  the  understanding  that  the 
location  was  permanent,  the  terms  thereof  being  complied 
with.  It  is  not  right  for  the  Commonwealth  to  induce  her 
children  to  pay  their  money  for  her  grants  by  burying  the 
same  in  the  street,  when  she  knew  they  supposed  that  the 
grant  was  permanent ;  and  then  the  next  year,  or  at  any  time, 
say  to  them,  "  I  shall  withdraw  the  grant  unless  you  pay 
more  money  to  some  city  treasury."  This  proposition  is  not 
honorable,  and  no  State  can  afford  to  entertain  it. 

My  second  proposition,  then,  is  that,  whatever  the  law  may 
be,  no  Legislature,  under  the  circumstances  existing  here, 
with  which  you  are  all  acquainted,  can  afford  to  put 
itself  in  the  position  of  committing  a  breach  of  faith. 
As  to  new  locations  it  is  totally  different.     As  to  old  ones 


42 

we  have  done  things  upon  an  understanding  and  an  agree- 
ment, and  the  Legislature  cannot  afford  to  go  back  on  it,  as 
the  phrase  is.  If  they  wish  to  change  their  policy  and  in 
the  future  make  any  change  that  they  please,  they  have  a 
legal  right  to  do  it,  and  I  make  no  complaint  of  that.  I  shall 
hereafter,  however,  come  to  the  question  of  public  policy 
even  upon  that.  The  history  of  our  road,  in  brief,  is  that  it 
began  in  1859  and  it  did  not  pay  a  dividend  for  years,  unless 
it  was  the  first  year,  so  that  the  men  who  built  it  could 
shoulder  the  stock  off  on  to  somebody  else,  and  for  twenty 
years  thereafter  it  paid  no  dividend,  and  only  the  last  third 
of  the  time  has  it  paid  any.  We  earned  some  money  there 
during  that  twenty  years  and  I  have  been  working  there  for 
the  public,  nothing  else,  for  twenty-five  years  until  recently, 
and  what  we  might  have  declared  in  a  dividend  we  laid  up. 
Where  ?  Buried  it  where  the  public  would  get  the  benefit 
of  it,  because  we  expected  if  we  built  up  the  road  and 
suited  the  people  we  would  make  something  out  of  it. 
Self-interest  is  the  mainspring  of  human  action,  but  at  the 
same  time,  when  you  come  to  horse-railroading,  the  only 
self-interest  you  can  have  is  such  as  will  lead  you  to  please 
your  patrons,  and  we  have,  instead  of  putting  money  in  our 
pockets,  which  we  have  a  right  to,  we  have  put  it  into  the 
plant  and  the  public  have  got  the  benefit  of  it,  and  we  have 
been  laying  up  treasures  where  we  supposed  it  might  do  us 
some  good  when  our  hair  is  gray,  and  the  blood  runs  more 
slowly,  and  now  that  time  has  come,  some  people  think  it 
honorable  to  come  and  take  it  from  us,  and  they  have  the 
audacity  to  come  here  to  this  Legislature  and  to  ask  the 
power  of  the  Legislature  to  financially  destroy  us  before  the 
altar  in  the  very  temple  of  justice.  It  is  wrong,  and  every 
man  knows  it  as  soon  as  he  thinks  of  it,  to  destroy  a  man's 
treasure  that  he  has  laid  up  for  his  life  without  any  more 
warrant  for  it  than  is  shown  here.  I,  for  one,  pity  any  man 
who  will  pursue  such  a  course,  and  I  hope  that  light  may 
fall  upon  all  such,  that  they  may  see  justice  truly  and  fairly. 
Now  what  we  want  is  to  have  the  old  Commonwealth 
treat  all  her  children  honorably.     She  always  has  done  it. 


43 

and  I  do  not  believe  there  is  a  man  on  this  Committee  who 
will  pass  any  vote  to  have  anything  else  done  with  these 
€ompanies  that  are  serving  the  public  constantly.  What  we 
want  is  stability,  honor,  confidence. 

The  day  will  come  when  every  one  of  the  cities  coming 
here  will  be  ashamed  of  doing  the  act  that  they  have  done. 
It  is  very  easy  when  they  have  manufactured  a  sentiment 
and  a  current  that  runs  that  way,  but  you  wait  until  the 
employees  begin  to  be  pinched  and  you  wait  until  the  pas- 
sengers begin  to  be  pinched  and  they,  begin  to  feel  the  wrong 
of  this,  and  you  will  find  the  current  running  the  other  way 
quite  as  hard  and  a  good  deal  harder  than  it  is  now  this  way, 
and  you  will  see  political  crafts  that  are  trying  to  catch  the 
wind  dashed  on  the  rocks. 

I  come  now  to  the  third  division  of  my  paper.  It  is 
against  public  policy  to  require  any  more  burdensome  terms, 
when  locations  (old  or  new)  are  granted  to  street  railway 
companies.  They  already  pay  as  much  and  bear  as  heavy 
burdens  for  what  they  get  as  such  companies,  on  an  average, 
pay  and  bear  in  other  States  for  what  they  get;  and  very 
few,  if  any,  can  afford  to  bear  any  greater  burdens. 

It  may  be  legal  to  change  this  policy  which  has  been 
established  and  running  for  forty  years,  to  make  no  money 
charge  when  the  location  is  granted  but  only  place  burdens 
upon  them.  This  has  been  the  uniform,  established  custom 
in  this  State  and  is  supported  by  London,  which  has  the 
wisdom  of  the  world,  and  has  done  it  for  a  long  time  and 
ought  to  know  what  public  interest  requires,  but  I  say  it  is 
not  wise  to  change  it  and  I  would  draw  the  line  just  where 
it  always  has  been  drawn.  Give  the  cities  and  towns  what- 
ever power  you  have  a  mind  to  to  regulate  the  use  of  the 
streets  by  the  railroads  in  conjunction  and  concurrence  with 
other  uses.  Make  them  pay  all  that  they  fairly  can  or  ought 
to  pay  in  fair  dealing  with  this  sort  of  a  public  corpora- 
tion. Make  them  pay  what  is  provided  in  the  mayor's  bill, 
if  you  choose,  because  that  leaves  no  chance  for  any  scan- 
dals or  troubles  ;  but  do  not  cross  that  line.  Do  not  let  any 
governmental  power,  any  political  power,  have  the  handling 


44 

of  anything  pertaining  to  money.  It  is  a  maxim,  which  you 
all  well  know,  that  that  government  governs  best  that  gov- 
erns least  and  keeps  the  peace  and  preserves  property,  and, 
in  accordance  with  that  maxim,  do  not  give  the  city  any- 
thing more  to  do  with  money,  especially  in  the  way  sug- 
gested here,  than  you  can  help.  There  are  a  thousand 
wa3^s  in  which  you  can  burden  these  poor  corporations,  but 
that  would  be  unwise,  although  it  would  be  a  great  deal 
more  in  accordance  with  the  established  policy  of  this  Com- 
monwealth than  to  proceed  in  this  kind  of  way,  for  I  think 
this  comes  the  nearest  to  legalized  robbery,  in  my  point  of 
view,  of  anything  that  I  ever  heard  of ;  but  if  you  want  to 
place  any  more  burden  upon  them,  do  it  within  the  line 
which  has  been  heretofore  followed,  in  the  various  ways 
which  the  statute  suggests  and  already  provides  —  but  I 
tell  you  they  cannot  afford  to  do  any  more,  not  even  the 
West  End. 

There  is  a  six  per  cent,  waste  every  year,  there  is  every  now 
and  then  an  epizootic,  which  is  sufiBcient  to  kill  a  dividend ; 
there  are  your  damages ;  and,  by  the  way,  I  have  touched  on 
a  subject  that  is  very  fruitful.  These  damage  cases  are  very 
expensive.  There  is  not  a  case  where  a  woman  gets  her 
little  finger  injured  but  runners  are  out  after  her  to  get  her 
case  for  certain  offices. 

Then  there  is  snow  —  very  heavy  this  year;  then  there  is 
the  grain  crop  —  oats  64  cents  instead  of  33. 

Mepresentative  Kittredge.     Sixty-nine  to-day. 

Mr.  Proctor.  Higher  and  higher.  I  simply  know  it 
drains  the  last  dollar  that  a  horse  railroad  takes  in.  Then 
there  are  hard  times  every  now  and  then,  when  there  is  no 
money  to  pay  for  riding;  then  the  fares  are  reduced  to 
the  very  lowest  notch,  because  it  is  fashionable  to  have  it 
a  nickel.  Then  there  are  long  lines  through  very  sparsely 
settled  districts. 

There  is  no  earthly  reason  for  limiting  it.  These  cor- 
porations are  entirely  in  the  hands  of  the  public,  and  you 
can  get  out  of  them'  all  you  want  without  crushing  them 
in  the  dust.     What  is  the  consequence  of  putting  on  any 


45 

limitation?  You  have  got  to  go  to  work  and  have  a  sinking 
fund,  and  sinking  funds  are  a  curse  ;  someboby  will  steal 
them ;  let  a  man  own  his  house,  not  let  somebody  else 
own  it.  It  simplifies  the  process.  Give  us  honest,  square 
dealing. 

Bepresentative  Quincy.  You  are  entirely  satisfied  with  the 
legal  status  of  locations  at  present  ? 

Mr.  Proctor.  Yes,  sir ;  I  am  satisfied,  with  this  exception. 
There  has  been  such  a  misstatement  of  the  facts  which  I 
mentioned  this  morning,  —  to  wit,  that  we  do  not  pay  any- 
thing, which  is  not  true ;  that  we  pay  less  than  other  people, 
which  is  not  true  when  you  take  everything  into  considera- 
tion ;  and  that  we  are  able  to  pay  more,  which  is  not  true, 
—  while  such  things  have  gone  forth  into  this  community 
through  pamphlets  or  something  else  and  poisoned  the  pub- 
lic ear,  and  when  reports  have  gone  forth  since  this  hearing 
commenced,  which  have  reached  the  capitalist's  ear,  and  the 
capitalist  is  made  cautious  so  that  he  will  not  invest  in  this 
kind  of  stocks,  a  wrong  has  been  committed,  and  this  Com- 
mittee ought  to  see,  in  all  fairness  (if  they  think  it  is  right 
to  make  any  bill),  they  ought  to  see  that  this  bill  corrects  all 
this  wrong,  and  shows  to  the  public  that  that  right  is  vested 
and  secure ;  and  I  have  made  an  amendment  which  I  shall 
submit  to  you,  providing  for  permanence,  so  that  this  wrong 
will  be  righted.  If  these  additional  burdens  are  put  on 
under  this  new  policy,  then  wages,  fares,  service,  extension, 
all  improvements  must  change. 

This  new  policy  says  it  is  going  to  put  more  money  into 
the  treasury  of  the  city  of  Boston,  but  it  ought  not  to  come 
from  the  horse  railroads.  It  ought  to  come  from  the  tax- 
payers. The  taxpayers  are  all  rich,  or  most  of  them  are, 
and  the  passengers  of  the  horse  railroads  are  poor,  but  the 
money  that  goes  into  the  city  treasury,  as  I  am  informed, 
is  not  used  in  the  best  manner.  I  will  say,  and  I  want  you 
all  to  bear  this  in  mind,  because  it  bears  on  the  question  of 
policy,  that  every  dollar  that  you  take  off  of  fares  the  pas- 
senger gets  a  hundred  cents  for.  Every  dollar  that  goes 
into  the  city  treasury  —  how  much  of   it  does  the  public 


46 

get  ?  Each  one  can  decide  for  himself.  Now  I  say,  Pre- 
serve the  present  policy,  which  has  been  to  reduce  fares  as 
low  as  possible,  give  the  best  service,  and  then  every  benefit 
which  comes  from  the  horse  railroad  remains  right  where  it 
ought  to,  in  the  passengers'  pocket  and  comfort.  Change 
the  whole  policy  and  cramp  the  passengers  with  miserable 
service,  like  Baltimore,  put  the  money  into  the  treasury  of 
the  city,  and  you  injure  the  community. 

I  ask  you  in  great  earnestness  that  you  will  draw  the  line 
where  it  always  has  been.  Give  the  city  the  control  it  has 
had,  but  do  not  give  it  any  money  ;  let  it  get  that  .from  the 
taxpayers.  That  is  best  for  all ;  and  do  not  cross  that  line 
if  you  wish  to  avoid  troubles. 

Now  I  say  the  true  policy  of  the  State  is  to  grant  a 
permanent  right ;  capital  buried  in  the  street  (for  the  right 
to  place  the  iron  and  the  sleepers  takes  the  place  of  the 
capital) ;  the  franchise  tax,  low  fares,  best  service,  large 
extensions,  —  and,  by  the  way,  I  want  to  say  one  word  about 
that  subject  of  extensions  in  addition  to  what  Mr.  Whitney 
said.  I  have  owned  a  large  lot  of  land  out  in  the  country  as 
trustee,  and  I  have  sold  it  and  I  know  about  the  benefit  of 
railroads  being  extended  out  and  mechanics  living  out  there. 
These  men  buy  these  small  lots  and  build  on  the  summits- 
of  the  hills,  on  the  sunny  slopes  and  in  the  valleys  where 
they  can  listen  to  the  music  of  the  brooks  and  the  songs  of 
the  birds,  and  when  they  do  that,  you  have  got  healthy 
citizens.  You  compress  them  into  a  small  space  in  the 
city  and  they  are  like  apples  in  a  barrel  and  they  will 
rot.  Those  are  the  two  extremes.  Which  policy  will  you 
adopt?  I  have  had  occasion  in  the  Mechanics'  Institute 
to  address  nearly  a  thousand  doctors  of  Massachusetts,  and 
I  said  to  them,  as  I  say  to  you,  that  the  race  is  depreciating 
and  every  aurist  and  dentist  and  pliysician  in  the  land 
will  tell  you  that  the  constitution  of  some  Americans  is 
depreciating. 

Greece  was  the  most  refined  country  that  tlie  world  ever 
saw,  in  culture,  finish,  manners,  and  all  that  sort  of  thing, 
and  while  this  was  her  condition  luxury  came  in  and   her 


47 

blood  was  poisoned ;  and  Rome  went  the  same  way.  Rome 
conquered  Greece,  but  Greece  conquered  Rome  by  her 
luxurious  habits  and  Rome  went  down  with  all  her  gladia- 
torial power,  and  it  is  the  same  thing  that  is  going  on  to- 
day, and  there  is  one  man  on  this  Committee  that  I  know 
knows  it.  Teeth  are  becoming  like  chalk  and  the  ears 
cannot  hear,  and  I  am  one  of  the  unfortunates  myself,  and 
the  people  have  less  vigor  except  in  some  of  the  new  races 
that  have  come  in,  who  have  not  got  Americanized  yet,  and 
whose  nervous  temperament  has  not  been  impaired,  and  I 
have  the  pleasure  of  excepting  some  of  them  from  the  class 
I  have  described. 

Now,  I  say,  if  you  want  to  give  health  to  old  Massa- 
chusetts and  preserve  the  pristine  vigor  which  characterized 
her  in  the  days  of  the  Puritan,  extend  out  into  the  country 
as  far  as  you  can,  and  grant  every  facility  that  you  can, 
instead  of  cutting  off  these  arms  and  crowding  the  people 
into  the  centre  of  the  cities,  that  they  may  decay  still  faster 
than  they  are  decaying  now.  I  shall  leave  to  you  the  policy, 
now,  as  to  the  permanent  rights,  capital  buried,  franchise 
tax,  low  fares,  best  service,  large  extensions,  care  of  streets, 
removing  snow.  All  those  things  are  now  done  by  the 
corporations,  and  they  are  all  that  they  can  afford  to  do, 
and  so  I  say  that  I  know  from  twenty-five  years'  experience 
that  what  I  am  saying  is  the  truth. 

Now,  what  do  these  gentlemen  want  here  ?  They  want  a 
new  policy;  they  want  more  consideration  paid  for  the 
locations.  We  cannot  stand  it.  They  want  more  taxes, 
and  they  want  a  limited  tenure. 

All  this  movement  you  have  before  you  here  tends  to  city 
ownership  of  the  whole  business.  I  have  not  the  slightest 
objection  to  having  the  cities  or  towns  through  which  we 
pass  take  our  railroads  at  a  fair  valuation,  and  I  have  no- 
thing more  to  do  with  it.  I  do  not  want  this  eternal  fuss 
and  squabbling. 

Hepresentative  Rosnosky.  Do  you  think  it  would  be  in 
the  public  interest  to  have  that  done? 

Mr.  Proctor.     That  is  just  what  I  was  coming  to.     This  is 


48 

the  entering  wedge  leading  to  it.  The  efforts  of  this  set 
of  persons  here  is  going  to  end  in  the  cities  running  all  the 
horse  railroads,  and  when  that  comes  then  God  save  the 
Commonwealth  of  Massachusetts !  A  greater  abomination 
could  not  be  conceived  of. 

Representative  Quincy.  Horse-railroad  people  would  be 
willing  to  sell  out  to  the  city? 

Mr.  Proctor.  Horse-railroad  people  ^re  ready  to  sell  out 
at  any  time.  They  have  had  about  enough  of  this,  as  far  as 
I  know  anything  about  them.  We  are  ready  to  sell  ours 
out.  If  the  cities  want  them,  they  can  have  them  for  a  fair 
valuation  by  experts.  These  eternal  attacks  —  it  is  attacks 
by  damage  cases,  and  atttacks  by  people  who  say  you  have 
got  no  rights  anywhere,  and  attacks  by  this  and  attacks  by 
that;  and  if  we  are  going  to  have  those  kinds  of  attacks, 
and  people  are  going  to  ask  the  old  Commonwealth,  the 
mother  of  us  all,  to  destroy  us,  I  should  rather  die  than  to 
live  to  see  such  a  result  —  to  see  that  the  Commonwealth's 
honor  is  to  be  degraded  so  low.  I  hope  not  to  live  to  see 
that  day. 

(On  motion,  the  hearing  was  adjourned  to  Monday,  April 
6,  at  10  A.M.) 

The  Chairman.  The  continued  hearing  upon  the  subject 
of  street  franchises  is  now  in  order.  Mr.  Proctor  will  pro- 
ceed with  his  argument. 

Mr.  Proctor.  Mr.  Chairman  and  Gentlemen,  —  So  far  we 
have  had  a  plain  talk,  a  mutual  talk,  searching  for  what  is 
truth,  to  find  out  what  is  best  for  all  concerned,  simply  that 
and  nothing  more.  I  have  shown  you  how  the  petitioners' 
move  is  against  the  law,  is  against  good  faith,  is  against  pub- 
lic policy  for  forty  years,  against  health  and  harmony,  and  I 
have  suggested  the  enormity  of  the  city  being  made  its  own 
judge  without  limit  of  how  much  money  it  shall  take  from 
one  corporation  treasury  to  put  into  another. 

In  answer  to  Mr.  Kittredge's  question  the  other  day  which 
was  passed,  as  to  getting  more  money  out  of  the  corporation 
for  the  city  by  enlarging  the  street  repairs,  in  my  judgment 
they  are  paying  all  that  is  now  reasonable.     Their  property 


49 

is  taxed  and  that  goes  towards  paying  for  street  repairs,  and 
then  they  take  care  of  a  large  part  of  the  street,  and  that  is 
more  than  is  reasonable  already,  and  you  cannot  get  any 
more.  If  you  undertake  to  get  any  more  under  the  guise  of 
repairs  of  the  streets,  in  ray  judgment  it  will  be  illegal 
because  it  will  be  an  indirect  attempt  to  get  money  which 
the  Court  of  Appeals  decision  which  I  read  here  said  was 
illegal  and  void.  These  indirect  methods  are  just  as  bad  as 
the  direct  ones,  and  to  attempt  to  put  a  larger  charge  than 
what  is  reasonable  on  the  repairs  of  streets  for  the  use  that 
they  make  of  them  would  be  one  of  those  indirect  methods 
which  would  be  as  void  as  the  direct. 

Brother  Bailey  asked  me  Friday,  gentlemen,  if  I  would 
comment  on  the  Marginal  Railroad.  Chief  Justice  Gray 
says,  "  Upon  the  absolute  repeal  of  a  charter  by  the  Legisla- 
ture, acting  within  the  limits  of  its  constitutional  authority, 
the  corporation  ceases  to  exist,  and  no  judgment  can  after- 
wards be  rendered  against  it  in  an  action  at  law.  But  such 
repeal  does  not  impair  the  obligation  of  contracts  made  by 
the  corporation  with  other  parties  during  its  existence,  or 
prevent  its  creditors  or  stockholders  from  asserting  their 
rights  against  its  property  in  a  court  of  chancery,  in  accord- 
ance with  the  reasonable  regulations  of  the  Legislature,  or 
with  the  general  principles  and  practice  in  equity." 

This  cautious  opinion  of  the  Court  shows  you,  Mr.  Chair- 
man, that  the  law  stands  the  same  as  to  creditors  and  stock- 
holders that  it  does  as  to  mortgages  when  you  annihilate  the 
charter  of  a  corporation.  The  receiver  is  bound  to  take  the 
franchise  right,  the  contract  rights,  whatever  they  are,  and 
with  whomsoever  made,  and  dispose  of  them  according  to 
the  law,  and  give  the  proceeds  of  the  sale  to  the  stock- 
holders, to  the  creditors  and  the  mortgagees ;  and  there  is 
not  a  lawyer  in  Boston  that  will  raise  any  question  about  a 
mortgagee's  right  to  the  franchise  which  has  been  mortgaged 
to  it  with  the  consent  of  the  Legislature.  In  short,  the  case 
to  which  I  have  just  referred  exactly  supports  the  doctrine 
which  I  stated  Friday,  that  the  contract  rights  of  the  corpo- 
ration are  preserved  notwithstanding  the  corporation's  exist- 


60 

ence  is  ended,  and  that  by  a  receivership  the  receiver  can 
sell  its  franchise  rights  and  dispose  of  the  proceeds  to  the 
stockholders,  creditors,  mortgagees,  and  that  they  all  stand 
on  the  same  legal  basis  as  to  those  contract  rights,  whether 
the  contract  is  with  third  parties  or  is  a  contract  between 
the  corporation  and  the  Commonwealth.  And  I  want  you 
to  remember,  what  I  forgot  to  say  Friday,  that  all  the  loca- 
tions of  my  road  have  been  confirmed  by  the  Legislature  by 
distinct  act,  chapter  152  of  the  Acts  of  1881,  which  shows 
you  what  the  Legislature's  opinion  is  as  well  as  what  is  the 
Court's  opinion,  that  this  contract  is  made  by  the  Legislature. 
Now,  gentlemen,  I  want  to  ask  your  pardon  for  touching 
upon  that  subject  of  good  faith,  because  it  seems  to  me 
impossible  that  this  Legislature,  the  mother  of  these  crea- 
tures created  by  it,  could  ever  exercise  any  bad  faith  against 
them,  and  my  excuse  is  simply  that  these  men  who  have 
come  here  advocating  these  positions  have  forced  me  to 
bring  this  question  to  the  front ;  and,  gentlemen,  when  one 
of  your  Committee  asks  me  if  a  board  of  aldermen  could 
not,  by  concealing  its  reason  for  its  action,  get  a  judgment 
of  revocation  against  a  corporation  and  so  hold  it,  implying 
that  a  board  of  aldermen  might  do  such  a  thing,  and  thereby 
get  a  grip  that  it  ought  not  to  get,  and  encourage  a  practice 
that  would  be  almost  too  sharp  for  the  Police  Coui't  of  Bos- 
ton, I  say,  when  such  a  thing  is  suggested  here,  is  it  not 
about  time  for  you  to  look  out  for  the  honor  of  the  Com- 
monwealth upon  the  question  of  whether  you  will  leave  the 
matter  to  any  board  of  aldermen  who  might  do  such  a  thing  ? 
I  do  not  believe  they  would  do  it,  and  when  it  is  suggested 
by  high  authority  as  a  way  in  which  indirectly  they  can  get 
a  bleeding  process  going,  it  is  time  for  me  to  call  your  atten- 
tion to  the  subject.  This  attempt  to  feel  all  around  every- 
where to  find  a  place  where  you  can  tap  a  corporation  as 
you  would  a  sugar  tree,  to  get  the  sap  out  of  it  —  as  the 
city  looks  around  at  all  these  corporations  to  see  how  it  can 
get  money  out  of  them,  reminds  me  of  the  advice  that  a 
father  gave  his  son  who  was  going  out  into  the  world,  "  Get 
money  !     Get  it  honestly,  if  you  can,  but  get  it." 


51 

Now,  gentlemen,  we  have  attacks  on  the  right  hand  and 
attacks  on  the  left,  attacks  in  front  and  attacks  in  the  rear, 
and  four  petitions  to  Committees  attacking  us  all  at  one 
time  in  this  Legislature.  What  I  ask  of  you,  gentlemen,  is, 
whatever  you  do,  put  a  stop  to  this  attacking  which  depre- 
ciates property,  and  depreciates  property  that  is  invested 
where  it  is  doing  more  good  to  the  people  of  the  Common- 
wealth than  any  other  property  in  the  land,  and  you  know 
it  and  the  people  know  it.  I  have  in  my  mind  a  street 
railway  corporation  that  was  organized  only  last  year  and 
it  has  put  $100,000  in  the  streets  in  laying  its  track,  and 
if  the  position  of  these  revolutionists  is  correct,  that  prop- 
erty is  not  worth  a  dollar ;  it  won't  pay  for  taking  up,  and 
the  rest  of  that  property  cannot  pay  their  debts.  That 
illustrates  to  you  the  wrongness  of  this  position,  a  corpo- 
ration not  in  existence  a  year,  and  its  property  gone  out 
of  sight ;  make  that  right  permanent  mth  what  they  have 
buried  in  the  street,  and  their  capital   is   back    and    alive. 

The  Chairman.  Mr.  Proctor,  do  you  state  to  us  as  an 
expert  or  upon  figures  that  the  tracks  and  roadbed  con- 
nections of  a  street  railway  after  they  have  been  laid  new 
will  not  pay  for  taking  up  ? 

Mr.  Proctor.  After  it  has  been  used  any  considerable 
time.  I  would  not  say  that  exactly  new  when  taken  right 
up  again,  but  old  iron  will  sell  in  the  market  like  an  old 
bonnet.  The  sleepers  are  certainly  good  for  nothing  when 
down,  and  of  course  the  longer  they  have  been  down  the 
more  absolutely  worthless  they  are,  but  the  expense  of 
taking  up,  the  cost  of  labor,  is  very  much  in  putting  the 
street  back  in  repair.  If  you  sold  the  second-hand  railroad 
iron,  it  would  not  bring  enough,  as  I  have  been  told  by 
experts  and  judging  from  my  experience  of  twenty-five 
years. 

The  Chaii-man.  What  would  be  the  fact  in  the  case  of 
a  paved  street,  if  you  had  to  repair  the  pavement  in  addition 
to  the  ordinary  macadamized  road. 

Mr.  Proctor.     It  would  only  make  it  worse. 

The   Chairman.     Would  it  leave  anything  for  the  railway  ? 


52 

Mr.  Proctor.  No,  sir ;  I  do  not  think  it  will  leave  any- 
thing. I  give  you  that  illustration  to  show  you  the  utter 
absurdity  of  the  position  ;  that  is  to  say,  the  proposition 
which  my  friend  George  Fred  Williams  stated,  that  you 
conld  have  plenty  of  capital  to  put  in  the  street  if  you 
should  adopt  his  principle.  Why,,  it  is  too  absurd  to  think 
of  it. 

Again,  gentlemen,  this  is  a  case  worse  than  Grangerism  in 
the  West ;  but  I  want  to  call  your  attention  to  Nebraska, 
where  they  have  passed  a  law  cutting  down  the  freight 
twenty  per  cent.,  and  it  has  raised  such  a  howl  among  the 
employees  of  steam  railroads  and  among  the  people  of  the 
State  who  are  dependent  upon  steam  railroads,  and  they 
have  sent  so  many  petitions  to  the  governor  that  the 
governor  has  declined  to  sign  the  bill,  and  I  understand  has 
vetoed  it.  I  merely  state  to  you  that  that  is  just  what  will 
take  place  here. 

Follow  this  course  that  is  marked  out  here  for  you,  and 
you  will  put  on  the  horse  railways  the  burden  of  enlighten- 
ing their  employees  and  their  passengers,  in  just  the  way 
that  you  have  been  informed  on  the  subject  here  so  that 
they  will  understand  it,  and  they  will  take  out  of  the  public 
mind  the  poison  that  has  been  put  in  it  by  Document  No. 
144.  The  railroads  have  got  to  overcome  the  wrong  which 
has  been  done  by  wrong  statements  or  half-statements,  and 
we  have  got  to  spend  an  immense  amount  of  money  to  cor- 
rect that  and  educate  the  people  on  the  subject,  or  else  you 
have  got  to  put  into  some  bill  here  something  that  will 
give  us  stability  and  confidence. 

Now,  gentlemen,  I  want  to  say  that  you  cannot  compare 
New  York  and  Massachusetts  in  this  matter.  I  have 
referred  to  it  before,  but  it  is  intensely  important;  it 
touches  the  hinge  of  this  whole  matter.  Short  lines  through 
thickly  settled  portions  of  a  city  earn  say  ilOO ;  $50  goes  to 
expense,  20  per  cent,  to  dividends,  and  30  to  the  passen- 
gers or  .the  city.  In  New  York  it  goes  to  the  city.  In 
Massachusetts  with  long  lines  sparsely  settled,  you  take  in  a 
hundred  dollai-s,  and  the  expense  of  running  the  road  would 


53 

be  ninety,  and  the  other  ten  might  pay  two  or  three  per 
cent,  dividends.  Another  difference  is  this  :  more  than  half 
of  our  companies  have  nothing  left  for  anybody  after  paying 
expenses,  and  there  is  nothing  left  for  the  stockholders' 
dividends  or  the  city  or  the  passengers.  Now,  just  bear  that 
little  illustration  in  mind,  and  do  not  forget  it.  The  policy 
here  has  been  permanent  grant,  capital  buried,  franchise  tax, 
low  fares,  best  service,  large  extensions,  health  and  harmony, 
care  of  the  street,  damages  paid,  snow  removed,  and  such 
things,  and  that  takes  all  there  is;  and  when  gentlemen 
come  here  and  flippantly  tell  you  to  give  the  city  a  chance 
to  bleed  them,  what  is  it  coming  from  ?  Wliere  is  the  bleed- 
ing coming  from,  with  nothing  in  the  treasury?  And  in 
companies  that  barely  pay  a  dividend  (and  that  covers  all 
the  rest),  when  you  have  your  exj)enses  taken  out  and  your 
small  dividend,  there  is  nothing  left,  and  where  is  the  bleed- 
ing coming  from?  You  know,  and  everybody  knows,  that 
the  expenses  must  be  paid  first,  and  a  reasonable  dividend 
comes  next :  and  it  is  idle  to  open  the  way  for  the  city  to 
take  anything  where  there  is  nothing  to  take. 

Gentlemen,  I  just  now  succinctly  stated  to  you  the  old 
policy.  I  come  now  to  say  the  new  policy  is  the  same  as 
the  old,  with  two  elements  added,  short  lines  and  something 
for  the  city  (although  the  petitioners  only  name  one,  to  wit, 
to  pay  the  city  something),  and  I  have  shown  you  there  is 
nothing  from  which  to  pay  them.  If  you  want  to  make  it 
like  New  York  or  any  of  the  other  large  cities  where  some- 
thing is  paid,  you  have  got  to  add  the  second  element,  to 
wit,  bring  all  the  out-of-town  people  into  the  centre,  and 
shorten  the  lines  and  make  them  two  miles  instead  of  six 
miles  long.  By  doing  that,  you  will  wipe  out  eighteen 
millions  of  property  in  the  companies.  There  is  no  possi- 
bility of  its  being  done  and  it  is  too  absurd  to  be  mentioned. 
And  you  will  be  confronted  with  the  proposition  of  moving 
all  the  country  houses  into  the  city,  which  the  people  will 
not  allow  anybody  to  do,  for  they  are  the  sovereigns ;  so  that 
the  second  element  in  making  Boston  like  New  York,  or  like 
any  place  where  there  is  money  paid  to  the  city,  cannot  be 


54 

brought  about ;  it  is  physically  impossible,  and  it  would  be 
simply  wickedness  in  the  extreme  to  put  in  one  of  the 
elements  without  the  other,  and  it  would  be  as  physically 
impossible  to  comply  with  the  one  element  of  paying  money 
into  the  city  unless  you  bring  in  the  other.  If  you  want  to 
have  things  alike  all  over  the  world  in  this  system,  just  go 
to  New  York  and  make  one  change  and  you  will  accomplish 
it :  reduce  the  fare  on  their  greatest  route  from  North  River 
to  East  River  from  five  cents  to  three.  Where  you  have  got 
$100  now,  you  will  then  have  reduced  those  receipts  to 
$60,  and  have  150  for  expense  and  $10  left  for  dividends ; 
but  when  you  come  to  Boston  and  try  to  make  it  like  New 
York,  it  is  physically  impossible.  Gentlemen,  they  told  us 
here  that  there  was  a  principle  at  stake  when  you  pressed 
them  hard  on  the  facts  and  law,  but  I  tell  you  it  is  no  princi- 
ple at  all,  but  a  policy,  and  the  policy  is  different  in  one 
place  as  the  circumstances  are  different  from  what  they  are 
in  the  other.  So  you  see,  gentlemen,  there  is  no  question  of 
principle,  for  a  principle  can  be  applied  everywhere.  It  is 
simply  a  question  of  policy ;  and  when  a  man  begins  to  talk 
to  me  about  a  principle  in  the  matter,  and  wants  a  thing 
done  because  there  is  a  principle  at  stake,  I  begin  to  suspect 
him.  He  is  like  a  man  that  comes  to  me  and  wants  to  talk 
business,  and  begins  to  talk  about  religion,  and  then  I  begin 
to  look  out.  You  want  to  come  down  to  what  is  the  practi- 
cal effect  of  what  the  man  is  saying,  and  then  you  will  find 
out  what  is  wanted.  These  theories  and  so-called  principles 
are  very  mischievous,  and  oftentimes  destructive  of  the 
good  of  the  Commonwealth.  Why,  gentlemen,  you  might 
just  as  well  say  because  one  woman  wears  a  pink  ribbon 
every  other  woman  shall  wear  a  pink  ribbon.  Now,  you 
know  here  is  no  principle  about  that,  for  the  New  York 
brunette  can  wear  a  pink  ribbon  and  bring  the  complexion 
out  stronger,  but  the  Boston  girl  with  a  delicate  complexion 
puts  on  a  pink  ribbon  and  she  is  as  pale  as  death.  It  is  just 
so  with  these  horse-railway  matters.  You  can  put  on 
the  pink  ribbon  in  New  York  and  make  the  companies  pay 
something  into  the  State  treasury,  but  if  you  put  on  the 


r>5 

pink  ribbon  in  Boston  it  is  death  to  the  corporation  that  you 
put  it  on  to.  Talk  about  principle  !  Is  it  not  about  time  to 
suspect  the  man  that  talks  about  the  question  of  principle, 
whether  money  shall  be  paid  into  the  treasury  of  the  State 
or  not,  not  his  honesty,  but  his  prudence,  his  wisdom,  or  his 
want  of  it,  or  his  want  of  knowledge,  which  is  most  likely 
always  all  the  trouble  in  the  matter.  Now,  I  say  there  is  no 
principle  in  this  matter :  it  is  a  matter  of  policy,  of  prudence, 
of  wisdom  ;  no  principle  about  it  at  all. 

Every  dog  that  has  a  taste  of  sheep's  blood  will  follow  it 
until  it  has  got  its  last  drop,  and  he  will  follow  every  other 
sheep  that  is  within  its  reach  or  sight,  and  for  that  reason  I 
say,  in  all  discretion  and  judgment,  stay  the  hand  that  shall 
seek  to  destroy,  however  innocently  wrong  they  may  be,  but 
stay  it,  and  save  the  comfort  of  the  people  which  they  enjoy 
now.     I  would  bring  the  public  opinion  to  bear  on  the  cor- 
poration in  every  possible  way,  but  alluding  to   the  munici- 
pal corporations,  such  as  they  are,  I  want  to  say  Tiothing 
more  about  them  than  I  find  in  that  celebrated  Document 
No.  144,  page  22,  namely :  "  It  must  be  admitted  that  the 
authorities  here  are  less  exposed  to  the  vicissitudes  of  Amer- 
ican municipalities,  and  the  scrupulous  retention  of  experi- 
enced men  in   office  has  greatly  aided  in  establishing  the 
present  creditable  condition  of  the  municipal  administration 
of  Berlin."     Now,  supposing  the  city  government  is  more  or 
less  better  or  worse,  they  may  legislate  as  much  as  they  have 
a  mind  to  as  to  burdens,  but  authorizing  them   to  act  as 
judges   of  how   much   money   they  shall   take    out  of    A's 
pocket  to  put  into  B's  is  like  the  arsenic  of  which  you  have 
heard  something  in  the   Legislature  this  winter ;  it  is  like 
what  Judge  Joel  Parker  said  at  the  last  Constitutional  Con- 
vention in  a  speech.     He  said,  "  This  is  in  some  respects  a 
most  excellent  Constitution.     It  is  a  good  deal  like  a  most 
excellent  loaf  of  bread,  but  it  has  got  altogether  too  much 
arsenic  in  it ;  it  has  spoiled  the  whole." 

The  Chairman.  Now,  Mr.  Proctor,  one  question  is  to 
determine  the  reasonableness  of  an  excise  law.  If  the  Leg- 
islature affirms  that  it  is  reasonable,  recites  that  it  is  reason- 
able, adjudicates  that  it  is  reasonable,  is  not  that  conclusive? 


56 

Mr.  Proctor.  It  cannot  do  anything  of  the  kind.  The 
Legislature  was  not  made  for  adjudicating.  The  Legis- 
lature is  made  for  enacting  laws,  and  another  branch  is  made 
for  deciding  whether  they  are  law  or  not  law. 

The  Court  says  in  133  Mass.,  page  161,  for  example,  that 
taxing  the  premiums  on  life  insurance,  non-resident  life 
insurance,  in  the  way  that  they  were  taxed,  is  reasonable. 
That  is  an  illustration  of  how  the  Court  passes  upon  it,  but 
there  was  no  double  taxation.  If  you  introduced  double 
taxation,  the  Supreme  Court  would  say  it  is  unreasonable. 
Now,  what  I  want  to  say  to  you  is  that  if  the  Legislature  in 
its  acts  says  a  thing  is  reasonable,  that  does  not  make  it 
so.  It  is  for  the  Court  to  say  whether  it  is  reasonable  or  not 
when  the  case  comes  up  under  it.  That  is  ray  position  ;  but, 
gentlemen,  when  I  was  interrupted  I  was  talking  about  let- 
ting the  city  legislate  or  act  as  judge  in  taking  money  from 
A  and  paying  it  to  B,  that  it  was  like  arsenic,  and  I  say  that 
in  the  propositions  that  have  been  introduced  here,  there  is 
more  arsenic  in  that  loaf ;  and  that  is  in  making  the  city  the 
judge  of  how  much  they  shall  take,  and  I  submit  that  those 
two  kinds  of  arsenic  are  sufficient  to  doom  the  whole  mass 
in  this  direction. 

But,  gentlemen,  there  is  another  little  feature  I  will  allude 
to  briefly.  The  city  of  Boston  looks  very  much  like  a 
spendthrift  youth.  The  Legislature  has  put  a  limit  on  the 
amount  it  shall  spend. 

Representative  Wilson.     No  more  than  they  have  on  other  ' 
cities. 

Mr.  Proctor.  And  other  cities.  It  has  put  it  on  just  as  a 
father  puts  it  on  a  son,  and  won't  pay  more  money  than  he 
ought  to,  and  when  he  puts  that  limit  on,  he  means  that  no 
more  dollars  shall  be  spent  than  such  a  limit  will  yield,  and 
he  means  his  son  shall  have  no  more.  Now,  gentlemen, 
what  does  a  son  of  that  kind  do  when  he  has  a  limit  put  on 
him  ?  He  goes  round  to  his  father's  friends,  and  by  repre- 
sentations to  them  he  gets  money  out  of  all  of  them,  and 
then  they  call  upon  the  father  to  pay,  and  he  comes  up  to  his 
father  and  says,  "  O  father,  you  pay  them.    I  will  bleed  them 


67 

as  much  as  I  can,  and  you  pay  them."  Now  that  is  about 
the  way  the  cities  of  the  Commonwealth  come  here.  They 
had  a  limit  put  on  them  by  their  old  mother,  the  Common- 
wealth, and  she  said,  "  You  shall  not  spend  any  more ;  "  and 
now  they  come  looking  round  into  every  corner  to  see  how 
they  can  get  a  chance  to  bleed  a  special  class  of  corporations ; 
they  have  been  looking  round  to  the  steam  railroads  to  see 
how  they  can  bleed  those,  just  like  a  spendthrift  boy,  and 
they  want  to  jump  over  the  bars ;  and  I  say  that  the  old 
Commonwealth  will  say  to  these  people  who  are  trying  to 
play  the  spendthrift,  "  Go  home  and  live  within  your  means, 
and  be  honest,  and  if  you  want  any  more,  earn  it  like  a 
man ; "  and  I  say  to  those  people  who  come  here,  "  Stand 
within  your  limit  like  a  man  ;  comply  with  it.  It  is  the  best 
thing  for  you,  for  the  city,  for  the  Commonwealth,  for  the 
people,  for  everybody ;  but  if  you  want  any  more,  earn  it 
honestly  and  change  your  limit  of  taxation." 

The  only  manly  way  to  do  is  to  determine  what  money 
these  cities  ought  to  be  allowed  to  spend,  and  tax  the  prop- 
erty directly.  Let  the  rich  taxpayers  pay  what  the  treasury 
fairly  needs  and  what  is  warrantable  for  them  to  have, 
instead  of  trying  to  get  it  out  of  some  of  the  father's  friends 
(perhaps  they  will  never  get  their  pay),  instead  of  trying  to 
take  it  out  of  the  poor  passengers  who  ride  in  the  horse-cars. 
I  say  the  policy  which  is  advocated  here  is  all  wrong,  and 
the  moment  you  start  over  that  line  that  I  have  drawn,  a 
line  which  has  been  established  for  forty  years,  you  have 
given  these  cities  a  taste  of  blood,  and  they  never  will  stop 
within  any  reasonable  limits.  I  do  not  believe  there  is  a 
man  on  this  Committee  but  what  would  admit  that  proposi- 
tion. 

Now,  one  gentleman  on  this  Committee  asked  my  friend, 
George  Fred  Williams,  if  he  thought  the  people  would 
approve  of  this  movement.  I  am  somewhat  amazed  that 
he  should  ask  what  people  would  say  about  a  thing  that 
they  know  no  more  about  than  they  do  about  watchmaking. 
If  he  had  asked  them  if  this  Document  No.  144  had 
created  such  an  impression,  that  would  have   been  a  fair 


58 

question,  but  if  you  ask  what  the  people  with  an  intelligent 
view  of  the  subject  would  say,  his  answer  would  be,  "  They 
would  say,  No." 

Now,  gentlemen,  only  very  briefly  further.  It  has  been 
asked  here  that  a  commission  should  weigh  this  subject 
carefully.  If  the  governor  will  appoint  a  good  business 
man,  who  has  nothing  to  do  with  railroads,  and  a  first-class, 
level-headed,  judicial  lawyer,  and  a  man  who  has  spent  his 
life  in  horse  railroads  and  knows  all  about  the  subject,  that 
commission  will  grind  out  a  policy  and  give  the  reasons  for 
it  so  that  anybody  who  runs  may  read,  and  that  will  produce 
the  best  result  that  you  can  reach.  There  is  no  occasion 
here  for  haste.  You  are  starting  a  ball  that  will  work  much 
ruin,  in  my  judgment,  if  you  open  the  door  even  for  money 
considerations  in  new  locations.  I  would  amend  the  city's 
bill  so  you  may  prescribe  the  terms  and  conditions,  exclud- 
ing money.  Open  that  door  and  you  are  gone  into  "  wan-, 
dering  mazes  lost." 

Senator  West.     It  is  the  same  thino-. 

Mr.  Proctor.  It  is  not  the  same  thing.  Tax  the  people 
for  what  the  old  Commonwealth  will  allow  cities  to  spend, 
and  they  cannot  have  any  more.  I  have  no  doubt  if  I  were 
in  the  city  government  I  would  want  more  money,  and  I 
would  try  to  get  it,  but  if  I  spoke  to  them,  I  should  say, 
"  The  only  way  to  get  it  is  to  come  to  the  Legislature  and 
get  the  limit  extended  to  have  more  money;"  and  I  say  that 
it  is  a  dangerous  policy  to  come  here  and  ask  to  have  it 
gotten  indirectly  out  of  any  special  class,  and  it  is  wrong 
for  them  to  spend  any  more  than  the  Commonwealth  sees 
fit  to  allow  them  to  spend.  They  are  a  mere  creature  of 
the  Commonwealth.  A  man  in  the  city  government  thinks 
he  has  got  a  sovereignty  in  the  city  government,  but  it  is 
so  no  more  than  a  horse  railway  corporation  :  it  is  an  agent 
of  the  people,  a  form  of  agency  through  which  business  is 
done.  Grattan  once  said,  "  Do  not  dare  to  lay  your  hands 
on  the  Constitution ; "  and  what  I  say  to  you  is,  Do  not  dare 
to  let  a  city  government  cross  that  line  and  begin  to  take 
money.     You  never  will  hear  the  last  of  the  trouble  which 


59 

will  come  from  it,  if  you  move  in  that  direction  one  dollar's 
worth. 

The  present  tax  by  the  Legislature  is  a  franchise  tax,  — 
«ee  99  Mass.  146,  —  there  is  no  doubt  about  the  law.  They 
■cannot  tax  that  franchise  again ;  it  would  be  double  taxation. 
In  the  case  of  Sandwich  Glass  Company  v.  Boston,  4  Met- 
€alf,  top  of  page  186,  it  says,  "  Double  taxation,  being  appar- 
ently unjust  and  unequal,  will  never  be  presumed  to  have 
been  within  the  intention  of  the  Legislature."  Again,  the 
Courts  say,  in  Lowell  v.  County  Commissioners,  146  Mass. 
409,  that  double  taxation  is  an  injustice;  and  the  Public 
Statutes,  chapter  13,  section  41,  provide  a  remedy  against 
double  taxation  when  the  value  of  real  estate  is  made  too 
small  by  the  state  commissioner.  There  it  is  all  in  a  nut- 
shell, clear  and  unmistakable.  First  the  injustice;  hence  it 
is  unreasonable,  and  so  within  the  Constitution.  No  Massa- 
chusetts corporation  was  ever  in  this  State  taxed  doubly. 

Now,  Mr.  Richardson  cites,  in  his  brief,  two  cases,  —  the 
foundry  case  and  another,  — in  which  he  implies  that  that 
argues  toward  double  taxation.  It  does  not.  The  real 
estate  was  taxed.  The  stockholders  paid  their  tax  on  the 
stock  in  the  places  where  they  lived,  and  no  one  party  was 
taxed  twice  ;  and  there  is  not  a  case  in  the  Commonwealth, 
there  is  not  a  particle  of  a  case  in  chapter  13  of  the  statutes 
where  there  has  been  any  double  taxation,  but  it  has  been 
most  specially  guarded  against  in  every  single  case ;  no  one 
party  is  taxed  twice.  Now,  for  your  information,  in  drawing 
your  bill  on  the  tax  side  of  it  you  may  tax  the  franchise  as 
much  as  you  like,  if  reasonable,  but  tax  it  twice  and  it  won't 
stand.  Now,  Mr.  Richardson  suggests  that  chapter  13,  sec- 
tion 60,  that  general  clause,  looked  as  if  there  could  be  double 
taxation,  but,  gentlemen,  he  did  not  go  back  to  see  where 
that  act  came  from.  It  comes  from  a  statute  of  1865,  chap- 
ter 283,  section  18,  and  there  is  a  proviso  that  a  tax  to  be 
paid  in  one  case  on  premiums  received  here  was  not  to  be 
computed  on  premiums  for  insurance  in  other  States,  so 
that  the  very  act  which  he  cites  to  show  double  taxation 
shows  that  the  Legislature  was  especially  careful  to  avoid 


60 

it  even  where  the  taxed  premium  was  in  another  State.  I 
want  you  to  bear  in  mind  that  invariably  in  every  case 
the  Legislature  has  been  always  specially  careful  to  avoid 
anything  that  looked  like  double  taxation. 

Mr.  Bailey.  That  was  because  they  thought  it  was  rather 
hard,  not  because  they  thought  they  could  not. 

Mr.  Proctor.  I  mean  to  say  I  don't  suppose  the  Common- 
wealth is  going  to  do  anything  that  is  wrong.  I  do  not  care 
how  much  power  they  have ;  I  do  not  want  to  contest  their 
power ;  but  I  appeal  to=  them  to  do  what  I  know  they  will 
do,  simply  what  has  always  been  honorable;  and  if  the 
Commonwealth,  which  has  lasted  two  hundred  years,  has 
never  varied  from  one  principle  of  taxing  once  the  same 
thing  to  the  same  parties,  and  not  twice,  is  it  not  rather 
too  late  a  day  to  begin  to  talk  about  taxing  the  same  thing 
twice  to  the  same  parties  ?  It  is  too  late,  too  wrong  to  be 
mentioned  for  one  moment. 

Brother  Richardson  says,  make  a  new  class  of  street  rail- 
ways and  tax  them.  I  have  not  the  slightest  objection  to 
that,  but  if  you  take  them  out  of  the  stock-list  class  and 
put  them  into  another  class  by  themselves,  you  cannot 
keep  them  in  the  stock-list  class,  and  you  all  know  that  at 
a  glance;  they  can  be  taxed  but  once.  That  is  just  what 
you  will  find  in  every  line  and  letter  of  chapter  13  to-day. 
I  have  no  objection  to  making  a  distinct  class  if  you  want 
to,  but  you  cannot  keep  them  in  the  stock  list  also. 

Representative  Quincy.  What  do  you  mean  by  a  distinct 
class  ? 

Mr.  Proctor.  Why,  to-day  all  companies  that  have  stock 
are  taxed,  or  nearly  all  are  taxed,  on  the  valuation  of  their 
stock,  and  all  corporations,  such  as  life  insurance,  that 
have  no  stock,  are  put  in  a  class  by  themselves  because 
they  cannot  be  reached  the  other  way  ;  they  are  exceptions. 
Now,  Mr.  Richardson  says  you  can  make  a  new  class  of 
those  street  railways.  I  do  not  think  it  would  be  right  or 
proper  to  do  so.  It  would  make  an  invidious  distinction. 
But  they  have  the  power,  and  if  they  did  put  them  in  a 
special  class  they  cannot  keep  them  in  the  other  class  too ; 


61 

there  is  not  the  slightest  question  about  it.  Now  whether 
this  proposition,  which  has  been  presented  here  to  get  some 
money  for  the  city  is  legal  or  not,  I  can  see  illegality ;  but 
1  think  there  is  this  possibility,  that  even  if  there  are  legal 
objections  to  it,  the  corporations,  if  you  give  them  the 
security  that  the  good  of  the  citizens  require  as  well  as 
themselves,  stability,  confidence,  and  honor,  on  that  basis 
they  may  accept  and  waive  any  objection  there  is;  and  I 
have  provided  for  those  elements  in  the  amendments  to  the 
bill.  Remember  that  we  do  not  accept  the  Boston  bill. 
I  have  given  you  the  reasons  why  I  think  it  is  wrong  on 
the  ground  of  public  policy  and  wi-ong  for  other  reasons; 
but  if  you  are  going  to  adopt  this  or  anything  like  it,  then 
certainly  we  should  have  these  amendments. 

[Mr.  Proctor  explained  these  amendments  and  submitted 
them  in  a  printed  bill.] 


^^^^^v^^•'-'-' 


^aV 


3  0112  062004897 


